i just discovered this tool in ib. is it of any value for trading? if you use it how do you use it. for instance right now the bar is compleatly red on the indu indicating cash is higher than the futures. tia. TWS Arbitrage Meter The Index Arbitrage Meter illustrates the extent of the premium (or discount) of the lead month futures price above (or below) its fair future value with respect to the index price. A green bar indicates that the lead month futures price is at a premium to (i.e. greater than) its fair future value. A red bar indicates that the lead month futures price is at a discount to its fair future value. This tool is available for Indices and Futures on Indices. To see the Arbitrage meter, make sure "Show Arbitrage Meter" is selected under the "Settings" menu. To display the Arbitrage Meter for an Index Click on the desired market data line to select the index. Right click and select Show Arbitrage Meter.
This is just a graphical representation of PREM. PREM (for spoo) and it's uses has been discussed on ET many times. nitro