Cash vs Futures

[moksha99]

Is it possible to trade a spread ( synthetic I suppose) between CASH and FUTRE
For example S&P 500 cash and Emini or Big S&P 500 Future
How would you take a position in the CASH/SPOT of the Index?
The answer can't be ETF , SPY because being an ETF it is a different animal not actual Index as such + to go long in such an ETF you only get 1:1 Leverage!

Any ideas?
MJ

 

[gc1]

Unless somebody has done a "fat finger" trade and spiked the price, the difference between the cash and future is just the interest rate of the currency that the index is quoted in. So I don't see why anyone would want to open such a spread trade.

 

[Martinghoul]

Well, not "just" the interest rate... It's the all-in carry, which would also include dividends. Unless you can trade baskets of stocks, I don't know of a way to do the cash-and-carry trades in indices. Although, come to think of it, I guess you can trade the spread if you spreadbet w/IG or some such.

 

[Rhody Trader]

You could also potentially use an ETF as a proxy for the cash index, but as noted before, this isn't something likely to prove worth doing. There are much bigger, faster shops with much lower transaction costs in the queue ahead of you waiting for spread deviations.

 

[moksha99]

You could also potentially use an ETF as a proxy for the cash index, but as noted before, this isn't something likely to prove worth doing. There are much bigger, faster shops with much lower transaction costs in the queue ahead of you waiting for spread deviations.

I don't trust OTC ( non exchange traded) products like Spreadbet because you are playing against the house
So what is other alternative to mimic SPOT index!

 

[Martinghoul]

I don't trust OTC ( non exchange traded) products like Spreadbet because you are playing against the house
So what is other alternative to mimic SPOT index!

None that are accessible easily to a retail investor...

 

[donaldduke]

Is it possible to trade a spread ( synthetic I suppose) between CASH and FUTRE
For example S&P 500 cash and Emini or Big S&P 500 Future
How would you take a position in the CASH/SPOT of the Index?
The answer can't be ETF , SPY because being an ETF it is a different animal not actual Index as such + to go long in such an ETF you only get 1:1 Leverage!

Any ideas?
MJ

If you have a spread bet account you can trade the S&P cash index and also the futures price.

If cash is trading higher than futures, short the cash and buy the futures or vice versa.

Eventually they will converge. Easy garanteed profit

 

[Dommo]

If you have a spread bet account you can trade the S&P cash index and also the futures price.

If cash is trading higher than futures, short the cash and buy the futures or vice versa.

Eventually they will converge. Easy garanteed profit

ho, ho!