Futures Pricing, Carry, and Delivery

Futures pricing, carry, and delivery terms explain why futures prices can differ from spot prices and how rolling, delivery, and storage economics affect returns.

In this section

• Contango: A Market Condition
  An in-depth look into the market condition known as Contango, where futures prices are higher than current spot prices, typically seen in hardening market scenarios.
• Cost of Carry: Essential for Investment and Trading Decisions
  An in-depth look at the 'Cost of Carry,' its significance in finance and investments, formulas, examples, and related concepts.
• Roll Forward in Derivatives: Extension of Options Contract
  Understanding the process of rolling forward in derivatives involving the closing of a shorter-term contract and opening a longer-term contract for the same underlying asset.
• Roll Yield: Definition, Positive & Negative Scenarios
  Comprehensive guide to understanding Roll Yield, its positive and negative scenarios, and its application in the futures market.
• Spot Price: Definition, Differences with Futures Prices, and Examples
  An in-depth look at the spot price, including its definition, comparison with futures prices, and practical examples.
• Taking Delivery: Accepting Receipt of Goods or Securities
  Taking Delivery refers to the process of accepting receipt of goods, commodities, or securities from a common carrier, shipper, or other entities, typically documented by signing a bill of lading or other receipt forms.