etfs WisdomTree WTI Crude Oil (CRUD.L) - impact of rollovers on capital

[Nick Left 0]

Hi, On the CRUD.l , how quickly will the rollovers eat away at the capital? It looks like the difference between say July and September contract is c30%. Does that mean that I would lose 30% of capital on a rollover? Is that how it works? How long can such a long position survive and still eventually make profit? Thank you

[Nick Left 0]

Can someone respond please? Does anyone know how to calculate the rollover cost? Thank you!!

[Tomaz Korosec + 3]

Yes. You sell 20, buy 25. There is no loss if market then goes up in this one month from current spot price of 20 to 25 until the end of the month. But is spot remains at 20, then prices of futures has to fall down to spot.. But there is a whole month in between. So you do not loose this money automaticly, but you do buy another month and higher and in this time for you to not loose anything price has to advance 25 % for the numbers I listed. But markets were in contango a lot of times before, maybe not that steep, but eventually there comes some good news or some unpredicted even and participants start to worry about the supply and oil goes up month after months and whole futures curve lifts up. Front months go up more, other months less, so contango is less and less and eventually even backwardation can happen..

Yes, now we are still in oversupply and a huge one, so I would not touch any front months. If you want to trade this go out at least a few months. I am currently playing with DBO etf which holds february 2021 futures. Still 300 days remaining and even this one goes down day after day, just in small %.. 

[Gini + 7]

Any ideas on what is happening with USO and HOU this morning?  Was there a reverse split or is the price so volatile for some other reason?

[MikiMak 0]

5 hours ago, Gini said:

Any ideas on what is happening with USO and HOU this morning?  Was there a reverse split or is the price so volatile for some other reason?

Yes there was a reverse split of 1 for 20 for HOU and a reverse split for of 1 for 8 for USO

[zangman 0]

Does anyone know what futures are being held by the wisdomtree wti CRUD index? It says it follows the Bloomberg wti subindex, but what exact futures composition does it have? Jun, Jul, Aug?

 

Surprisingly this information is nowhere to be found.

[Leigh 0]

On 4/28/2020 at 9:44 PM, Tomaz Korosec said:

Yes. You sell 20, buy 25. There is no loss if market then goes up in this one month from current spot price of 20 to 25 until the end of the month. But is spot remains at 20, then prices of futures has to fall down to spot.. But there is a whole month in between. So you do not loose this money automaticly, but you do buy another month and higher and in this time for you to not loose anything price has to advance 25 % for the numbers I listed. But markets were in contango a lot of times before, maybe not that steep, but eventually there comes some good news or some unpredicted even and participants start to worry about the supply and oil goes up month after months and whole futures curve lifts up. Front months go up more, other months less, so contango is less and less and eventually even backwardation can happen..

Yes, now we are still in oversupply and a huge one, so I would not touch any front months. If you want to trade this go out at least a few months. I am currently playing with DBO etf which holds february 2021 futures. Still 300 days remaining and even this one goes down day after day, just in small %.. 

Please I want to know the latest price of Jet fuel A1