Wide Basis
Categories: Accounting
The name of a plus-size clothing store for men.
Also, a price situation that arises in the commodity futures market.
This is going to seem obvious once we say it, but it's important to understand for the next part of the explanation: the futures market operates by pricing things in the future. It's all about locking in a price today for something you plan on buying in the future.
So a barrel of oil might be trading at $65 today, but you can buy a futures contract to purchase that oil three months from now at $70. You're betting that the price will rise above $70. If it goes to $74 and you've already locked in the $70 price, you can book a profit.
A wide basis refers to a big gap between the current price for the commodity (called the spot market: the amount you'd pay to obtain the commodity right now) and the futures price. It suggests that investors see a big change in the supply/demand mix coming up.