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Re: Futures
P,
Unless it's a cyclical commodity, ie.wheat, soy, corn, .....the later months are higher priced simply because you have more time to hold a contract prior to it's expiry date....and you pay for this "extra" time.. Now, with cyclical futures, the price per contract increases the further out you go, for the above reason AS WELL as to pay for the storage of said commodities. Being as how you never actually have to accept delivery of goods....someone has to store them for you. All this is figured into the price of a future's contract. If none of what I've said makes any sense, that's because I have no idea of what I'm talking about.
Regards,
Boi |
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