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Dear Mr John,
I would like to ask about commodity swap which is outside the syllabus but I think understanding it would help me more to understand ex, interest swap.
Since it is not in the syllabus, I googled it and read from several pages which mainly is Wikipedia. From what I read, could I consider commodity swap as a series of identical forward/future contracts, repeating again and again during the period of swap?
For example: A (user of a commodity) signed with B a swap valid in 1 years which allows A to pay fixed price to buy commodity in each of 12 months, any differences between fixed price and market price at each month would be paid/received between A-B.
I currently consider this swap as a series of 12 continuous identical forward/future contracts with expire period is 1 month. Is this correct to think so?
Thank you in advance!
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