Spot price vs futures price

The spot price is for delivery now; the futures price is for delivery later, and the gap is the cost of carry, which closes to zero at expiry. COMEX gold above London spot is normal, not arbitrage. A contract on a futures month has the roll inside its number, and a perpetual's gap to spot is closed by funding.

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  • Cost of carryCost of carry is what it costs to hold a position over time: storage, insurance and interest, minus any income. It is…
  • COMEXCOMEX is the New York exchange, part of CME Group, where benchmark gold, silver and copper futures trade. Globex runs…
  • Gold futuresGold futures are exchange-traded contracts on gold, the benchmark on COMEX in dollars per troy ounce, trading above…
  • Contract rolloverContract rollover is closing an expiring futures month and opening the next to stay exposed. Front at $85.00, next at…
  • LBMA gold priceThe LBMA gold price is the London benchmark set by electronic auction twice a day, at 3:00 PM and 7:30 PM IST (4:00 PM…
  • Strike price and expiryThe strike price is where an option pays; expiry is when a contract ends. Expiry is what ties a future to the real…

Educational content only. Not investment advice. Leveraged products magnify losses as well as gains.

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