Cost-of-carry model for pricing commodity futures

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Reference no: EM13870693

Discuss the problems involved in using the cost-of-carry model for pricing commodity futures? In particular, discuss why cash-futures basis is so variable for oil futures contracts, and its relevance for hedging programs in the oil market.

Reference no: EM13870693

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Cost-of-carry model for pricing commodity futures : Discuss the problems involved in using the cost-of-carry model for pricing commodity futures? In particular, discuss why cash-futures basis is so variable for oil futures contracts, and its relevance for hedging programs in the oil market.

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