Three Commodities Exhibiting Backwardation

Trading commodities in today’s markets has been nothing short of difficult. While the first quarter was relatively stable, Q2 has been anything but, with volatility returning to markets and unpredictable behaviors becoming the norm. Commodity futures are already volatile on their own, but throw in rocky markets and that effect is amplified. Rather than trying to make a speculative bet on day-to-day movements of commodities, investors can look to profit from backwardated futures curves. Backwardation is the process by which near month futures are more expensive than those expiring further into the future, creating a downward sloping curve for future prices over time [see also Invest Like Jim Rogers With These Three Agriculture Stocks ]. See the full story here →