Comments on: XLE Big Bullish Option Interest After Goldman Oil Outlook https://archive.theotrade.com/xle-big-bullish-option-interest-after-goldman-oil-outlook/ Where the Professionals Come to Trade Fri, 15 Jan 2021 22:13:36 +0000 hourly 1 https://wordpress.org/?v=7.0.2 By: Brandon Chapman https://archive.theotrade.com/xle-big-bullish-option-interest-after-goldman-oil-outlook/#comment-1756 Fri, 15 Jan 2021 22:13:36 +0000 https://archive.theotrade.com/?p=77965#comment-1756 In reply to the Goat.

The important thing to remember is that the forward prices don't represent future price expectations but rather the net cost of carry for commodities. If the net cost of carry is positive, then the market will be in backwardation, which reflects an implied future shortage. If you were looking at a cash settled product, like VIX futures, then the future price would reflect expectations.

]]> By: the Goat https://archive.theotrade.com/xle-big-bullish-option-interest-after-goldman-oil-outlook/#comment-1754 Thu, 14 Jan 2021 05:38:49 +0000 https://archive.theotrade.com/?p=77965#comment-1754 “ The falling prices represent an anticipated shortage heading into the summer months.”

Wait, what? Doesn’t an anticipated shortage typically lead to higher prices? Lost me on that one. What am I missing?

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