Why is there big discount in Coalindia march futures? Any reverse arbitrage opportunity?


March futures is at almost 21 points or almost 8%.

I have read this post on reverse arbitrage. Any way to make riskless profit? Or am I missing something?


Coal India has declared dividends during the month of Feb/Mar in the past two years, and it could be due around the same time this year. The difference in the Futures and Spot price could have accounted for this. We will come to know on 10th Feb when they announce their earnings for the quarter.


The Feb Future can be shorted and the Mar Future can be bought simultaneously. If the gap between the two futures reduces, there will be profit. Margin requirement will also be lower, so ROI could be handsome.

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@Tarzan Hope you are capitalizing on this… I am… :slight_smile:
Still a lot of gap that will get reduced slowly…
@VelmuruganSengottai What say?

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no :frowning:
i saw it in another thread about this coalindia discount but didn’t do anything …

i am in for any riskfree trades :slight_smile:
was thinking about about doing condor in bank nifty , but decided against it

How do you discover such opportunities?

Actually, I did not. It was @Tarzan who posted this find in this thread. When I saw this thread, I simply went and checked the live prices and the opportunity was wide open, actually, it’s still there…

By the by, just curious, your handle name resembles a TA on business news channels. Is it just a coincidence? :grinning:

Absolutely coincidence dear:sweat_smile:… i’m just a starter… hope to grow into his lines… but right now struggling to get my trades right.:roll_eyes:

Well, whether it’s a coincidence or not, we will never know. That’s the beauty of online blogging. :wink:

LOL… :rofl:

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chance pe dance

u still holding the trade?

Yes… the gap is still wide open…

can u share the current screenshot ?

The gap has widened, could be because of the impending results tomorrow… anyways will keep holding…

the thing is this is due to the dividend that is to be declared right? so how come do u think that ur going to profit or benefit from it? because as soon as the dividend is declared the price of both the futures will be nearly equal to the market price! a little difference as of Feb and mar expiry ) ! just wanted information because even i have found such scenarios but i haven’t traded any!

Dividend will definitely have an effect but I felt that the gap is too much as the dividend effect was being discounted too much… well, my assessment could be incorrect… only to wait and watch.

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Interesting to follow ! I am such a supporter of fair market that whenever i see a discount or arbitrage i think I might have missed something and its a trap :stuck_out_tongue:

Please mention your total capital blocked for the trade also. We will keep the risk free interest aside and see how much extra we earn at the end !

For some unknown reason Zerodha Margin calculator is acting dysfunctional when I add the March future with the Feb future, so I went to another broker’s margin calculator page and obtained the total margin required, their margin requirements is fairly similar to Zerodha’s… Total margin around 19.5k