Futures markets and fundamentals of base metals

Viviana Fernandez

International Review of Financial Analysis, 2016, vol. 45, issue C, 215-229

Abstract: According to the theory of storage, the interest-adjusted basis equals the warehousing cost minus the convenience yield (i.e., benefit of holding a physical commodity) per time unit. By assuming that warehousing costs relatively constant at alternative stock levels, the interest-adjusted basis will be inversely associated with the convenience yield.

Keywords: Theory of storage; Interest-adjusted basis (search for similar items in EconPapers)
JEL-codes: C13 L72 Q02 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:45:y:2016:i:c:p:215-229

DOI: 10.1016/j.irfa.2016.03.014

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