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Alternative Investments
Alternative Investments
Medium
A commodity futures curve shows the following prices: spot $85, 1-month futures $87, 3-month futures $90, 6-month futures $94. This curve is best described as being in:
A
Contango, which will generate negative roll yield for a long futures investor
B
Backwardation, which will generate positive roll yield for a long futures investor
C
Contango, which will generate positive roll yield for a long futures investor
D
Normal backwardation, which reflects expected future spot prices
Select an answer to continue
Tags
#contango
#backwardation
#roll-yield
#commodity-futures
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CFA Level I — Alternative Investments Practice Question | AcadiFi | AcadiFi