# Cash-and-Carry Arbitrage Strategy AI Agent Connect

> Identify and track deterministic futures arbitrage opportunities by exploiting contango.

## Overview
- **Category:** finance
- **Price:** Free
- **Endpoint:** https://edge.vinkius.com/vk_preview_vX8emYtyXczTxTvHJGu0f31V0DPd5Cw2ioGj2fXX/ai-agent-connect
- **Tags:** arbitrage, futures, contango, quantitative, trading-strategy

## Description

This MCP server provides quantitative tools to identify and manage cash-and-carry arbitrage opportunities. By analyzing the discrepancy between spot and futures prices, users can detect contango markets where the futures price exceeds the theoretical fair value. The server includes `analyze_arbitrage_signals` to detect entry and exit points based on liquidity and annualized basis, `calculate_position_economics` to determine locked-in profit and capital efficiency, and `monitor_basis_risk` to evaluate the stability of the arbitrage spread.

## Tools

### monitor_basis_risk
Evaluates the stability of the arbitrage opportunity by tracking the volatility of the basis

### analyze_arbitrage_signals
Identifies daily arbitrage entry and exit signals based on price discrepancies and liquidity constraints

### calculate_position_economics
Computes the expected financial outcomes of a specific arbitrage trade once a signal is identified

## Prompt Examples

**Prompt:** 
```
Analyze current market data for arbitrage opportunities.
```

**Response:** 
```
The current annualized basis is 14.5% with an open interest of 15,000 contracts, signaling a valid entry opportunity.
```

**Prompt:** 
```
Calculate the expected profit for an entry at $100 spot and $105 futures.
```

**Response:** 
```
The locked-in profit is $3.50 with a capital efficiency of 12.5% after accounting for all financing and transaction costs.
```

**Prompt:** 
```
Check the risk level for my current basis history.
```

**Response:** 
```
The current basis volatility is low, resulting in a Low risk assessment for this arbitrage position.
```

## Frequently Asked Questions

**What is a cash-and-carry arbitrage?**
It is a strategy where an investor buys a physical asset (spot) and simultaneously sells a futures contract to lock in a risk-free profit when the market is in contango.

**How does the tool determine an entry signal?**
Using `analyze_arbitrage_signals`, an entry is triggered if the actual futures price is higher than the theoretical price plus costs, the annualized basis exceeds 10%, and open interest is above 10,000 contracts.

**Can I assess the risk of my position?**
Yes, you can use `monitor_basis_risk` to evaluate the volatility of the basis and determine the qualitative risk level of your arbitrage position.