Exchange listed oil ETFs represent about a third of all contracts in June WTI crude. They must be sold given current market dynamics from May 11-may 15th. What do they do if oil goes negative before May 11th? Do they stop at Zero?
Or does “management” go into capital preservation mode and try to sell a third of open interest before it hits Zero and send what’s left of retail investor’s money back to them as a consolation prize for not losing everything? #usoil
What happens if June WTI crude trades below zero all at once with storage full?Could Wall St firms that carry positions for US listed oil ETFs be on the hook for billions in losses after retail investors lose everything? Looks like Amaranth happening all over again to retail ETFs
