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| Based on the market today, my opinion would be to have my HTA against the Dec until Dec 2. If it's a trend line yield with growing carryouts, board spreads will continue to widen as we enter into early December.
The trigger to spreads trading wider and wider is the threat and then the actual CME deliveries against the long CME contract holder during the delivery period which in our discussion is Dec 1, 2019. The basis is also at play during this time so a lot of moving parts.
In general with carry markets, one can expect the spreads to be at their widest point between the first and fifth day of the delivery period.
In general commercials and producers want wider carries and will behave in a way that helps that occur. End users /consumers don't like carries. They don't want to build bins and earn the carry. They want the market to consume the flat price carry from Z to H buy having the H fall to the value that the Dec was......
The carry is the vehicle of hope. It is not based on increasing intrinsic value of the underlying commodity. That is why the cash market today is about what it was 4 months ago.
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