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Basic Question 7 of 13
Under the storage hypothesis, commodities that are stored regularly should be ______.
B. in backwardation
C. flat
A. in contango
B. in backwardation
C. flat
User Contributed Comments 1
| User | Comment |
|---|---|
| krunk | backwardation could be a signal of current shortage of the commodity, so would fall within the context of global supply and demand. |
Thanks again for your wonderful site ... it definitely made the difference.
Craig Baugh
Learning Outcome Statements
compare theories of commodity futures returns;
describe, calculate, and interpret the components of total return for a fully collateralized commodity futures contract;
contrast roll return in markets in contango and markets in backwardation;
CFA® 2025 Level II Curriculum, Volume 5, Module 33.