I'm surprised IB let speculators trade in a contract going to delivery. I worked as a risk manager in a commodity trading firm and only hedgers qualified to take delivery were permitted to hold contracts going to delivery.
IB automatically closes out your position before delivery can happen if you don't close it out.. so not sure why you are surprised IB lets them trade?
>I worked as a risk manager in a commodity trading firm and only hedgers qualified to take delivery were permitted to hold contracts going to delivery.
Ehh.. what? I've been part of a CTA for many many years, we have trading programs.. our clients trade in our programs.. the entire industry never takes delivery yet trades all these contracts which have delivery (metals, ags, energies). Very confused what you are talking about.. everyone rolls out of these before first notice dates.. brokers are on your back a week before the FND are coming up.
"Delivery shall be made free-on-board ("F.O.B.") at any pipeline or storage facility in Cushing, Oklahoma with pipeline access to Enterprise, Cushing storage or Enbridge, Cushing storage."
Sure, but a majority of trading was done on CME futures. In either case, you still ran into the issue of negative prices. USO only recently started explicitly stating that they would also potentially invest in ICE futures alongside CME futures.
