Question
You have started trading in the commodity markets and are therefore investigating the possibilities of making a profit. Currently, the spot price of gold is
You have started trading in the commodity markets and are therefore investigating the possibilities of making a profit. Currently, the spot price of gold is SEK 50.00 per gram, while it is also traded on the futures market in one year, at a futures price of SEK 55.38 per gram. The cost of storage for one year is 8.06% of the spot price and the risk-free interest rate is 2.70%. Calculate how much arbitrage profit you can make per term at the end of the term (if it is not possible to make arbitrage profit, then set the arbitrage profit to 0). Round your answer to 2 decimal places.
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