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| Discuss NALCO Discount in Futures at the Futures within the Traderji.com - Discussion forum for Stocks Commodities & Forex; Nalco is having a discount of Rs 25 in far month adn around Rs 10 ... |
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#2
15th July 2007, 07:11 AM
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Re: NALCO Discount in Futures
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#4
15th July 2007, 12:11 PM
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Re: NALCO Discount in Futures
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#7
15th July 2007, 08:10 PM
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Re: NALCO Discount in Futures
This is a case of reverse arbitrage. The arbitrageur will have to sell Nalco stock and buy the futures. If this is done in sufficient size, the discount will narrow. Problem is, most pension funds/ insurance companies/ banks are not allowed to take an exposure to derivatives. So they hold large quantities of stock, and cannot use derivatives to enhance their returns.
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#8
16th July 2007, 10:15 PM
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Re: NALCO Discount in Futures
Spreads can also reduce in another way. Since Nalco spot has now gone up by 35Rs, it seems to be someone noticing this anomaly and then buying futures and then buying shares to put a royal squeeze on the futures sellers. Spread should narrow as the future sellers cover.
regards m
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#9
17th July 2007, 04:47 AM
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Re: NALCO Discount in Futures
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