View Full Version : NASDAQ OMX and IKON Launch Spot Gold Futures

Matthew Shelley
8th February 2012, 16:24

I think this is just more evidence that people are playing to the rafters in the Gold market. I haven't finished digesting the contract specs for this new product yet, but I saw something wrong and something suspicious so far. Wrong is that they are calling it "spot futures". That doesn't make sense, but it plays into the suspicious one. They are going to hit the traders for interest on the carry, which is normally priced into the futures, and average it to the nearest interest break point. I wonder if this means the exchange is going to squeak out a difference between interest bids and offers daily? It did say that the exchange was going to be adjusting prices for customers daily because of the interest thing. Which brings up something else, what are the tax consequences of a changing basis?

The whole thing is awfully convoluted and the fact that they are selling this to uninformed equities traders at 10 ounces a pop raises the hair on the back of my neck.