Does anyone know what this is talking about. I was told that the answer is gain 11 cents on the forward and 6 cents on the futures, but I can not figure it out. : ( Is this person wrong or am I just not seeing it?
Today you are long a heating oil forward contract for
March delivery in Chicago @ $ 1.54/gal and short a
NYMEX March heating oil (HOH) contract at $1.54.
On February 18 you sell a March Chicago HO vs NYMEX
HOH basis at < $.05> the board. You do an EFP/ADP
with your counter party and establish a cash/OTC price of
$1.60/ gal.
How much $ did you make (+ or -) in $ per gal
Show the cash flows of the trade.
thanks for your help and time.
