I know from Financial Futures that the futures price will equal cash at expiration. How is that in commodity futures ? Lets say the day of futures expiration the cash corn trades at 500 ... how much higher or lower is the futures price ? Does it equal the cash price or is it higher/lower and roughly by how much ?
Commodity Futures Prices at Expiration equals cash ?
- Thread starter trillenium
- Start date
If the contract is not cash settled better have warehouse space ready.
Just kidding, your broker knows you are not a hedger and should give you plenty of warning to close your position.
Just kidding, your broker knows you are not a hedger and should give you plenty of warning to close your position.
1) ?.....The futures price ought to be no lower than the cost of carry/delivery to the least advantageous delivery location of the least qualifying quality of commodity to satisfy delivery.
2) In other words, Cargill, as the "short", will deliver the worst quality of corn, to you the "long", to the most detrimental location. :eek:
