# Calendar Spreads in Futures

> A futures calendar spread buys one contract month and sells another. Learn bull and bear spreads, what moves them, seasonality and a worked crude oil example.

Source: https://learn.tradelabsai.com/futures/calendar-spreads-in-futures/  
Track: Futures · Level: Advanced · Updated: 2026-10-03  
Publisher: TradeLabs AI (https://tradelabsai.com). Education, not financial advice.  
Cite as: TradeLabs Learn, "Calendar Spreads in Futures", https://learn.tradelabsai.com/futures/calendar-spreads-in-futures/

A calendar spread in futures, also called an intra commodity or time spread, is long one contract month and short another month of the same product. Its value depends on the shape of the futures curve, not on the overall price level. Calendar spreads let traders bet on tightening or loosening supply, on seasonal patterns or on changes in carry, with lower risk and margin than outright positions. Options traders use "calendar spread" for a different trade across expiries, covered in [Calendar Spreads](https://learn.tradelabsai.com/options/calendar-spreads/).

## Bull and bear spreads

| Spread | Construction | Profits when |
|---|---|---|
| Bull spread | Long the near month, short the far month | Near month gains relative to far (curve moves toward backwardation) |
| Bear spread | Short the near month, long the far month | Far month gains relative to near (curve moves toward contango) |

The names come from storable commodities: when supplies tighten (bullish), nearby prices usually rise faster than deferred prices. See [Backwardation](https://learn.tradelabsai.com/futures/backwardation/) and [Contango](https://learn.tradelabsai.com/futures/contango/).

## What moves calendar spreads

- **Inventories:** low stocks push near months up relative to far months. See [Storage and Inventories](https://learn.tradelabsai.com/commodities/storage-and-inventories/).
- **Storage costs and financing:** set the maximum contango, often called "full carry".
- **Seasonality:** harvests, heating and driving seasons. See [Seasonality in Commodities](https://learn.tradelabsai.com/commodities/seasonality-in-commodities/).
- **Supply shocks:** disruptions mainly affect near months.
- **Roll flows:** large funds rolling positions can pressure specific spreads.

## Full carry

For a storable commodity, a calendar spread cannot stay in contango beyond the cost of storing and financing the commodity for long, because traders would buy the near month, store the commodity and deliver into the far month. That limit is full carry. Contango near full carry suggests ample supply; spreads far from full carry or in backwardation suggest tightness. See [Cash-and-Carry Arbitrage](https://learn.tradelabsai.com/futures/cash-and-carry-arbitrage/).

## Worked example

**Example: A crude oil bull spread**
The December crude contract trades at $78.20 and the following June at $76.90, a December minus June spread of +$1.30 (backwardation). A trader expects winter demand and low inventories to tighten supply further and buys the spread: long December, short June, one contract each (1,000 barrels).

Three weeks later, December is $80.10 and June $77.60, a spread of +$2.50. The spread rose $1.20, a profit of $1,200. If crude had instead fallen evenly across the curve, the trade would have been roughly unaffected; it loses only if the curve flattens or moves toward contango.

## Seasonal calendar spreads

Some markets have strong seasonal spread patterns:

| Market | Spread | Seasonal reason |
|---|---|---|
| Natural gas | March vs April | Winter withdrawal ends; "widow maker" spread known for violent moves |
| Corn | July vs December | Old crop vs new crop harvest |
| Soybeans | July vs November | Old crop vs new crop |
| Gasoline | Spring vs autumn | Summer driving season and fuel specifications |
| Cattle and hogs | Different months | Production cycles |

The natural gas March April spread earned its nickname after large losses at funds such as Amaranth Advisors in 2006. See [Amaranth Advisors](https://learn.tradelabsai.com/history/amaranth-advisors/) and [Natural Gas](https://learn.tradelabsai.com/commodities/natural-gas/).

## Calendar spreads in financial futures

- **Equity index futures:** the spread reflects interest rates minus dividends between expiries; it is mainly traded during rolls. See [Rolling Futures Contracts](https://learn.tradelabsai.com/futures/rolling-futures-contracts/).
- **Interest rate futures (SOFR):** calendar spreads express views on the timing of central bank rate changes.
- **VIX futures:** calendar spreads trade the volatility term structure. See [Term Structure Trading](https://learn.tradelabsai.com/volatility/term-structure-trading/).

## Margin and risk

Calendar spreads typically need much lower margin than outright positions, but risks remain:

- **Spreads can move violently** near expiry or in supply shocks.
- **The near leg expires first;** plan rolls and first notice day. See [First Notice Day and Last Trading Day](https://learn.tradelabsai.com/futures/first-notice-day/).
- **Liquidity** in distant months can be thin.

## Frequently asked questions

### What is a calendar spread in futures?

A position that is long one contract month and short another month of the same futures product, profiting from changes in the price difference between them.

### What is a bull spread in commodities?

Long the near month and short a deferred month, which profits if near term prices rise relative to later prices, usually when supply tightens.

### Why are calendar spreads less risky than outright futures?

Because the two legs usually move in the same direction, offsetting much of the price risk, though the spread itself can still move sharply.

Next, learn the refining margin spread in [Crack Spreads](https://learn.tradelabsai.com/futures/crack-spreads/).

## Continue learning

- Next lesson: [Crack Spreads](https://learn.tradelabsai.com/futures/crack-spreads/)
- Previous lesson: [Futures Spreads Explained](https://learn.tradelabsai.com/futures/futures-spreads-explained/)
- Related: [Futures Spreads Explained](https://learn.tradelabsai.com/futures/futures-spreads-explained/): Futures spreads buy one contract and sell a related one. Learn calendar, inter market and inter commodity spreads, margin benefits, quoting and worked examples.
- Related: [Contango](https://learn.tradelabsai.com/futures/contango/): Contango is when later futures trade above nearer ones or spot. Learn why it happens, how it erodes long commodity and VIX funds, and how traders use it.
- Related: [Backwardation](https://learn.tradelabsai.com/futures/backwardation/): Backwardation is when later futures trade below nearer ones or spot. Learn the causes, convenience yield, positive roll yield and what it signals about supply.
- Related: [Rolling Futures Contracts](https://learn.tradelabsai.com/futures/rolling-futures-contracts/): Rolling moves a futures position from an expiring contract to a later one. Learn when to roll, how to use calendar spreads, roll costs and common roll schedules.
- Related: [Calendar Spreads](https://learn.tradelabsai.com/options/calendar-spreads/): A calendar spread sells a near term option and buys a longer term option at the same strike. Learn how it profits from time decay and volatility, with examples.