Research

Cointango: Are institutional investors missing risk-free opportunities?

New report by Copper

Copper

16.03.2021

Anyone who has ever traded futures contracts would have noticed that they tend to trade at a slightly different price than spot markets.

While it is possible for the futures price to trade below the spot price, it is far more common for the futures to be trading at a price higher than the spot price, also known as contango.

Currently in the Bitcoin market, futures are trading in steep contango. This means it is possible for traders to capture the premium on the futures contract by executing arbitrage trades such as the ‘Cash-and-Carry’.

Our latest in-depth report, Cointango: Are institutional investors missing risk-free opportunities?, explains that it is entirely possible for traders to play this contango arbitrage without getting exposed to counterparty risk, thanks to the availability of new solutions that address such concerns.

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