What is convenience yield

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Reference no: EM132016213

The Price on a 1-year futures contract on a consumption asset is $1024.95/ unit while the spot price of the asset is at the same time $900/unit. The current level of the appropraite interest rate is 15%, while the storage cost is 5% per annum. A) What is the cost of carry here? What is the convenience yield ?

Reference no: EM132016213

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