Suppose the spot price of crude oil is $68/barrel. The 6-month forward price is $63/barrel. The storage cost is $2/barre

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answerhappygod
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Suppose the spot price of crude oil is $68/barrel. The 6-month forward price is $63/barrel. The storage cost is $2/barre

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Suppose the spot price of crude oil is $68/barrel. The 6-month
forward price is $63/barrel. The storage cost is $2/barrel. The
risk-free rate is 8%/year (continuous compounding). Is there an
arbitrage opportunity? If yes, please identify your strategy.
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