About Cookies on this site - This site uses Cookies to improve your online experience. By continuing to use this site without changing your cookie preferences we will assume that you are agreeing to our use of cookies.
Call us:+44-20-369-50335, Monday-Friday 8am-5pm
Enquiry details 
Thank you for your request.

We will call you in a few minutes.

Ship ToAustralia
LBMA Associate
HomeGlossaryInverted Market

Inverted Market

An inverted market is a state where current prices, sometimes referred to as 'short-term contracts' are higher than their future or long-term contract price. For example, if the price of gold in one month is higher than it is expected to be in coming months. A normal market or a market at 'full carry' is typically when the spot price is lower than it is for delivery a month in future. The price in a month is, in turn, lower than the price for the following month and so on. However, if the market is below full carry for a sustained period, prices start to converge – a state that's known as 'contango'. Eventually, the market inverts and the spot price becomes higher than the future delivery price. This inverted market phenomenon is known as 'backwardation'.