Futures Fair Value

Price futures via cost of carry
This free online futures fair value runs in your browser and is part of our Trading & F&O collection.

Futures Fair Value

Compute futures price via cost of carry

Formula

F = S × exp((r − d) × T), where T = days/365.

Educational use only.

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Instant In-Browser Execution Runs locally in JavaScript without wait times or server delays.
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100% Privacy & Security Your inputs and files are never stored or logged on remote servers.
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100% Free Forever No subscription fees, no signups, and no software installations.

How to Use the Online Futures Fair Value

1 Enter Cash Spot Price

Input the current market price of the underlying equity, index, or commodity asset.

2 Set Financing & Carry Rates

Enter the prevailing annualized risk-free interest rate and the expected dividend or convenience yield percentage.

3 Define Time to Expiration

Specify the exact number of days remaining until the futures contract expiry date.

4 Compute Fair Value & Basis

Click Calculate or use market presets (NIFTY, SPY, DJI) to generate the theoretical forward price, net carry rate, and theoretical basis (F − S).

Frequently Asked Questions

Common questions about using this free online futures fair value.

What is the Cost of Carry model for futures pricing? ▾
The Cost of Carry model calculates theoretical futures fair value as F = S × e^((r − d) × T), where S is the spot price, r is the annual risk-free rate, d is the dividend or carry yield, and T is time to expiration in years.
What does a negative Basis (Backwardation) indicate? ▾
When the futures price trades at a discount to the cash spot price, the market is in backwardation. This occurs when expected dividend yields or immediate physical convenience yields exceed financing interest costs.
What is the difference between Contango and Backwardation? ▾
Contango describes a market where futures trade at a premium over spot (positive basis), typical when financing and storage costs dominate. Backwardation is the opposite, where futures trade below spot.
Can this tool help identify cash-and-carry arbitrage? ▾
Yes. If the actual market futures price diverges significantly from the theoretical fair value calculated here, arbitrageurs buy the cheaper asset and sell the richer one to capture risk-free convergence at expiry.

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