Could you please explain the meaning? Thanks!
Up until last year futures were under the cash market since about 2008 and slowly the spread became closer and closer as we moved along. They hadn't ever been below the cash market in my entire life of trading so this was strange. This past year has seen the futures ES go back above cash and gain more and more of a spread. When we started the current June contract there was about a 32 point range above cash. This entire April cycle has remained about 30 points above but this past week saw it fall to 25 now around 22 points above cash. Of course it eventually has to get to the same level as cash level by the June expiration but this was a huge spread and before 2008 was usually always around 10 points above over history so this is another sign of way to much exuberance!!!
Thanks.
Does this difference reflect an imbalance in trading futures vs SPX option that is not arbitraged? A sign of using options to drive SPX (in this case) higher?