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backwardation |
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Backwardation The theory that says futures prices will tend to rise over the life of a contract. Therefore the near-term contracts trade at a higher price than the longer-term contracts. Notes: This is the opposite of "contango."Backwardation A market condition in which futures prices are lower in the distant delivery months than in the nearest delivery month. This may occur when the costs of storing the product until eventual delivery are effectively subtracted from the price today. The opposite of contango.
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? Mentioned in | ? References in periodicals archive | |
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The movement of passive investors into commodities shifted markets from backwardation to contango, the condition that occurs when futures prices exceed cash prices. Rifkin of OmniSource said the copper market's pricing and backwardation shows "the market is screaming for that material to come to the market today. says the copper market's pricing and backwardation shows "the market is screaming for that material to come to the market today. |
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