And the winner for best trade of 2018 is ... chocolate

Looking back on a tumultuous year where the majority of asset classes were deep in the red, cocoa futures turned out to be one sweet spot.

In fact, a look at the top year-to-date performers among major futures markets reveals that cocoa has returned a whopping 28 percent this year. (The only trade that did better were complicated bets in volatility futures, which gain in value along with the Cboe Volatility Index. Volatility is not a pure asset class like a commodity or other security.)

While the stock market and other risk assets were battered this year on fears of slowing global growth and trade battles, cocoa prices enjoyed a surge because of short supply as the dry weather in top producing areas such as Ivory Coast hurt production.

Main crop production ideas for Ivory Coast and Ghana are being reduced, with Ivory Coast now estimating its main crop production at 1.985 million tons, down from previous estimates just over 2.0 million tons. The higher cost of cocoa, which is used to make chocolate, has put pressure on candy companies this year. The Hershey Co. and Tootsie Roll Industries have both lost about 6 percent in 2018, while Nestle is set to finish the year flat.

Source: CNBC

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