0
$\begingroup$

I am looking at the following quotes of the futures prices of the S&P 500:
http://finance.yahoo.com/q/fc?bypass=true&s=ESM16.CME&ltr=1
The way I read this, the market thinks that there will no increase in the S&P 500 for the next year. That does not seem right to me. Is there something I am missing?

Bob

$\endgroup$
  • 1
    $\begingroup$ Have you taken into account dividends? $\endgroup$ – msitt Apr 2 '17 at 0:04
  • $\begingroup$ The futures prices are not based on expectations of where the market will be, but on the spot price, the interest rate and the dividends $\endgroup$ – Alex C Apr 2 '17 at 0:13
  • $\begingroup$ Msitt,I have taken into account dividends and therefore if I buy a basket of stocks representing the S&P 500 and I hold it for a year and the S&P 500 remains flat, I understand that my return will be positive ( say 3% ) because of dividends. However, that does not seem very good to me. $\endgroup$ – Bob Apr 2 '17 at 14:50

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Browse other questions tagged or ask your own question.