Basis

What is "Basis"?

Basis is the absolute spread between the futures price and the index price.

Why is it important?

• It quantifies the absolute gap between futures and reference pricing.
• It helps monitor market structure states, such as premium and discount regimes.
• It complements Premium by adding absolute-price context.

How is it calculated?

• Basis measures the direct price difference between futures price and index price.
• The sign shows whether futures trade above or below the index.
• Quotation and precision conventions are defined by the exchange methodology.