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. The closing price of silver at the last trading session has been 475 per ounce. Storage costs are 3.2 per ounce per year. Andrew,
. The closing price of silver at the last trading session has been 475 per ounce. Storage costs are 3.2 per ounce per year. Andrew, a derivatives market investor, is looking for investing in silver futures and has been told he would have to pay storage costs in advance only for the first two quarters, regardless of the length of the contract. Assuming interest rates are 7.2% p.a. for all maturities, what would be the futures price of silver for delivery in 15 months?
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