Copper Spreads

Discussion in 'Metal Futures' started by synchro, Jan 13, 2006.

  1. synchro

    synchro

    Copper looks to be in backwardation. What do you think of shorting the near-by contract and go long a longer-dated contract?
     
  2. don't take this the wrong way but if you have to ask, it is probably not a good idea to make this trade. Do you know why its in backwardation, how long it lasts, etc...
    :)
     
  3. synchro

    synchro

    I don't take it the wrong way. I don't even have an account that would allow me to buy pit contracts.

    I just want to learn.
     
  4. Seems somewhat arcane, will require extensive digging. No copper traders here apparently. Best of luck.:)
     
  5. ig0r

    ig0r

    It's in backwardation most likely because of a supply issue. There is almost always a fundamental reason why front month is in such high demand, and unless you have some copper you can deliver it may not be worth the risk.
     
  6. J-Law

    J-Law

    Throw a chart up see what the months you wish to trade look like.

    Just on basics, that trade is a bear spread and copper is in a bull run and as illiquid as an OTC sink sheet stock !!!!!! I think there is like 12 traders in that ring on the COMEX, maybe more.

    But take a look at it anyway.

    once again my 2c.....
     
  7. J-Law

    J-Law

    Throw a chart up see what the months you wish to trade look like.

    Just on basics, that trade is a bear spread and copper is in a bull run and as illiquid as an OTC sink sheet stock !!!!!! I think there is like 12 traders in that ring on the COMEX, maybe more.

    But take a look at it anyway.

    once again my 2c.....