narrow basis

Narrow Basis

A situation in which there is only a small difference between the spot price and the futures price for a commodity. This occurs when investors expect there to be little shift in supply or demand between the present time and when the commodity is delivered under the futures contract. A wide basis often becomes a narrow basis the closer a futures contract comes to maturity because there is less uncertainty; when this does not occur, arbitrage opportunities arise.

narrow basis

A market condition in which only a small difference exists between a spot price and futures prices for the same type of contract. Compare wide basis.

单词	narrow basis
释义	narrow basis Narrow Basis A situation in which there is only a small difference between the spot price and the futures price for a commodity. This occurs when investors expect there to be little shift in supply or demand between the present time and when the commodity is delivered under the futures contract. A wide basis often becomes a narrow basis the closer a futures contract comes to maturity because there is less uncertainty; when this does not occur, arbitrage opportunities arise. narrow basis A market condition in which only a small difference exists between a spot price and futures prices for the same type of contract. Compare wide basis.
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