Here is a great trade for those having fiat, but dare not invest more in bitcoin due to the downside risk.
1 Buy a bitcoin
2 Sell a 6 month forward, using the bitcoin as collateral.
3 Collect a USD20 no risk*) profit. That is a 7% in 6 months. Buy an extra ice cream now, care free.
The reason is that the forwards are 20 % higher than spot, indicating an expected rise, in aggregate, by the market.
You have the same phenomenon in oil, except storage of oil is costly, which means that a larger spread on the future/spot is necessary to make a profit.
*) except third party risk.
I don't personally go into this, I would rather just have the bitcoin, I don't mind the risk.
1 Buy a bitcoin
2 Sell a 6 month forward, using the bitcoin as collateral.
3 Collect a USD20 no risk*) profit. That is a 7% in 6 months. Buy an extra ice cream now, care free.
The reason is that the forwards are 20 % higher than spot, indicating an expected rise, in aggregate, by the market.
You have the same phenomenon in oil, except storage of oil is costly, which means that a larger spread on the future/spot is necessary to make a profit.
*) except third party risk.
I don't personally go into this, I would rather just have the bitcoin, I don't mind the risk.
What exactly are you looking at, OKC futures? Didn't know they have 6 month contracts :/
It is weird they only have 1, 2 and 3 weeks contracts and they cost more than the spot price

