CL: calendar spreads more liquid than outrights,why?

Bone,

You have chosen to to use ET as a forum to solicit business. Doing so brings with it the responsibility of being accountable for your posts. If you choose to neglect those responsibilities by deflecting questions and or calling into question the qualifications of others, it only serves to send put up a red flag,

Regards, local
 
This might be a silly question, but just to clarify are we talking about a wide inter-month spread during the contract term that's trading beyond full carry and/or about convergence to spot upon expiration?

Seems like they tend to go hand in hand and the issue is both, although I'm not sure.
 
Funny, I was talking to a fellow trader with 10+ years experience and he was of the opinion that CL contract may become obsolete.
 
Might be tough to find a replacement for CL in terms of liquidity - CL volume today was 919,641 and open interest is 1,514,230.

Not counting the ClearPort and ICE Swaps volume.

The problem with the contract in terms of hedging is the fungibility into the Cushing delivery spec. It is certainly an imperfect contract in that regard, but of course the start-up success for new futures contracts is really poor. The Dubai contract is fantastic in theory, never has really been able to attract the liquidity.
 
Quote from local:

I have also been trading the H/J spread, watching it move past full carry. Re volumes, if I am a commercial intent on moving the spread beyond carry, spread volumes have to be greater than outright volumes otherwise spread will go nowhere. The contract is obviously "broken", has been the case over the past 2 years (I think the H/J went to about $8.50 2 years ago). I suspect that a number of the commodity futures contracts are going to have similiar problems accomodating increased open interests.

Regards, local
More...

I checked: that was the then front spread, occurred on 12/19/2008, -$8.49

and then on 1/16/09, -6.06
on 2/6/09, -5.98
 
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