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The oil-storage trade, also referred to as contango, is a market strategy in which large, often vertically-integrated oil companies purchase oil for immediate delivery and storage—when the price of oil is low— and hold it in storage until the price of oil increases. [1]
Contango is a situation in which the futures price (or forward price) of a commodity is higher than the expected spot price of the contract at maturity. [1] In a contango situation, arbitrageurs or speculators are "willing to pay more [now] for a commodity [to be received] at some point in the future than the actual expected price of the ...
Contango Announces Sale of Alta Investment HOUSTON--(BUSINESS WIRE)-- Contango Oil & Gas Company (NYSE MKT: MCF) announced today that Alta Energy had recently signed a contract to sell its ...
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Every investor in Contango Oil & Gas Company ( NYSEMKT:MCF ) should be aware of the most powerful shareholder groups...
Futures prices tend to be in contango; The volatility of spot and futures prices tend to be low, and futures premiums rise to the full cost of storage; When supplies are tight, and purchasing managers build production inventory levels to ensure availability, Futures prices tend toward backwardation
While small-cap stocks, such as Contango Oil & Gas Company (AMEX:MCF) with its market cap of US$91.47M, are popular for their explosive growth, investors should also be aware of theirRead More...
The situation where the price of a commodity for future delivery is higher than the expected spot price is known as contango. Markets are said to be normal when futures prices are above the current spot price and far-dated futures are priced above near-dated futures.