INTL COPPER CONF: Metals funds raise bets on spreads as price volatility wanes

Metal trading funds and the metal commodities industry in general are increasingly focused on trading copper spreads and staying away from bets on outright price, panelists at the International Copper Conference said on Wednesday March 13.

This shift has been helped by diminishing volatility in copper’s outright price, and better visibility over market fundamentals ahead of a macroeconomic environment that is increasingly hard to predict, panelists from Red Kite Capital Management, Arion Investments and Freepoint Commodities told audience members at the conference in Amsterdam. Copper spreads have swung wildly in recent times. The cash-3 month spread on the London Metal Exchange moved from a $30 per tonne backwardation on November 30 last year to a $54 contango on December 14, to a $62 backwardation on March 1 and recently back down again. And such strong movement provides a solid platform on which funds can trade, while the outright price remains...

Published

Archie Hunter

March 14, 2019

20:20 GMT

London