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EC IL | Thud if they make money on basis appreciation is that not margin? I get what your saying about appreciation,and they always hedge the "what they buy it for and what they sell it for" so no money is typically made on the board of trade. As they say it goes up half the time and down half the time and in the end it all works out. Rolling to capture carry is how the big storage elevators make money cause they hold a bunch of bushels the "river houses" make it by turning them a hundred times a year so smaller margin but more turns. A elevator can hold a small % unhedged but it's very small and only for a short period of time. | |
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Explanation of Basis
