CME new ag swaps

[TraDaToR]

http://www.chicagobusiness.com/article/20120123/NEWS01/120129936/cme-to-expand-clearing-of-ag-swaps

What is the interest of calendar swaps for commercials? The settlement price is the monthly average price of daily close if I am right.

 

[ogarbitrage]

Less volatility because it's an average of settlements, occasionally across two underlying months.

 

[TraDaToR]

Thanks. It must move close to the futures at the beginning of the month and barely at the end( the settlement is almost known ...), right?

 

[ogarbitrage]

Correct.