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Commodities Briefing - Categorized | Commodity Crisis, Investment more

Investors find way to lose money

Posted on 11 December 2008

From Cattlenetwork.com: Investors burned by the commodity crash this year now have another way to lose money. Some markets that major commodity indexes track have tilted into an extreme version of a pattern known as “contango,” in which commodities for delivery within weeks cost less than those for delivery later on.

Index-tracking funds often “roll” nearby contracts from one month to the next as they expire. In a contango market, that means selling low and buying high on a monthly basis. …. Full Article: Source


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VRS - who has written 34604 posts on Opalesque Commodities Briefing.


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