Housing Futures Show Signs of Life

The S&P/Case-Shiller housing numbers are set to come out this morning.  The CME has futures that trade based on these numbers, and below we highlight a historical price chart of the Composite 10-City future expiring in November 2008. 

The May Composite 10-City median home price came in at $181,480, and the current price of the November future has the median home price pegged at $175,000.  This is just 3.57% lower than May prices. 

What's interesting about the November contract is that it bottomed out in June and has been rising slightly since.  So while expectations are still for lower prices from current levels, investors are not expecting them to fall as much as they were a few months ago.

click to enlarge

Comments

[Commenter:]

How does the volume work on this? Open interest is 21 and average is 13. That does not seem like much. Are these Case Shiller futures worthwile considering the low volumes?

2008 Aug 26 12:08 PM