That's usually the case in risk off conditions. For you home gamers that you means you earn the roll yield for being long protection! That's important to note because you usually are paying it. That also means you do NOT want to buy XIV in backwardation. Most of you guys know this stuff but just putting it out there.
The ACD Method
- Thread starter sbrowne126
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That's usually the case in risk off conditions. For you home gamers that you means you earn the roll yield for being long protection! That's important to note because you usually are paying it. That also means you do NOT want to buy XIV in backwardation. Most of you guys know this stuff but just putting it out there.
Great interview.
Odd strength in the front spread this week despite WTI hitting new lows. Front spread hit the MAdown on Wednesday and went straight up to the MAup.
Many trades believe we are starting to see a flattening of the curve which could lead to a quick trip into backwardation if the front WTI should ever have a multi-week rally. This is likely due to hedgers rolling. It seems odd that we could have a backwardated market at these price levels though. Especially when you look at how full storage is.
Many trades believe we are starting to see a flattening of the curve which could lead to a quick trip into backwardation if the front WTI should ever have a multi-week rally. This is likely due to hedgers rolling. It seems odd that we could have a backwardated market at these price levels though. Especially when you look at how full storage is.
We're still pretty far off from that no? Looks like we wicked off of both the A down and A up. Lot of movement there for sure but given how far this thing has dropped it seems reasonable.
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It's still a dollar away from being backwardated right?
Hmm Ok. That chart looks ugly. I need to run some number lines on these spreads. I expect they are still deeply negative. It's kind of hard to imagine getting back to parity anytime soon from looking at that chart. We had a flat curve back in May of last year briefly. As always I usually refer to the number lines. I'll run them and see where we are.
sorry, if i wasn't clear on that. there was a sense that we could be pushing $3 of contango on front spread, not the other way around.
i actually sent out a trade alert to my guys on Wednesday telling them that if they wanted to try and catch this knife, then to buy the front spread and not flat price and lean against the MAd. One of them was skeptical because the fund rolls started today and go through the 14th. However, the trade worked out very well and I've got a few guys happy with me. ACD > fundies
i actually sent out a trade alert to my guys on Wednesday telling them that if they wanted to try and catch this knife, then to buy the front spread and not flat price and lean against the MAd. One of them was skeptical because the fund rolls started today and go through the 14th. However, the trade worked out very well and I've got a few guys happy with me. ACD > fundies
Natty has has been quietly rallying all by itself since making that weekly Aup. Nearly all the news wires have been filled with China and indices, whilst the natty has been acting like someone lit the touch paper.