Are you to ready buy a June contract for water?
For the first time in the United States, water will be joining gold, crude oil, and other commodities on Wall Street. Beginning this week, hedge funds and armchair investors are can bet on or hedge against water scarcity on the Chicago Mercantile Exchange (CME).
Futures will be quarterly until 2022 and each contract will be 3.26 million gallons. They will be settled financially instead of taking physical delivery.
The purpose of this trade is to manage risk and better slign supply and demand.
Like SPAC – companies that go public without offering anything – this could possibly be the most interesting development in the financial market.
“Climate change, droughts, population growth, and pollution are likely to make water scarcity issues and pricing a hot topic for years to come,” said RBC Capital Markets managing director and analyst Deane Dray in a statement. “We are definitely going to watch how this new water futures contract develops.”
What a fascinating market!
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