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Basic Question 8 of 13

Which commodity yield can be either positive or negative to the long investor?

I. Collateral yield
II. Roll yield
III. Spot price return
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User Contributed Comments 3

User Comment
johntan1979 Don't be too sure that collateral yield can never be negative e.g. negative T-bills like what happened last year.
drewnelson In practice, collateral isn't necessarily held till maturity and can by negative.
Sagarsan88 I am not sure. But if interest rate are negative the collateral yield will still be zero. As you won't invest the margin money in risk free bond but hold it as cash?
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Your review questions and global ranking system were so helpful.
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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.