[Verse 1]
When you buy commodities, there's more than meets the eye
Three puzzle pieces hiding in your portfolio's disguise
Spot return shows the raw price swing, from gold to oil to grain
But roll and collateral returns complete the total gain
[Chorus]
Spot, roll, collateral - three parts make the whole
S-R-C will decode your commodity's role
Spot tracks the market price, rolling futures through time
Collateral earns interest while your investment climbs
Break it down, piece by piece
Total returns find their peace
[Verse 2]
Roll return's the hidden twist when futures meet their date
Backwardation pays you well, contango seals your fate
When near-term costs more than distant months, your roll return's negative
But when the curve slopes upward, those rolling gains are positive
[Chorus]
Spot, roll, collateral - three parts make the whole
S-R-C will decode your commodity's role
Spot tracks the market price, rolling futures through time
Collateral earns interest while your investment climbs
Break it down, piece by piece
Total returns find their peace
[Bridge]
Collateral return's the steady beat beneath the volatility storm
Treasury bills and bonds transform your cash into uniform
Risk-free rates accumulating while your futures dance around
Three components synthesizing, making total profits sound
[Verse 3]
Oil tanks plunge but roll return cushions all the pain
Wheat prices soar while negative roll cuts into your gain
Collateral keeps humming its reliable refrain
Understanding each component helps your strategy remain
[Chorus]
Spot, roll, collateral - three parts make the whole
S-R-C will decode your commodity's role
Spot tracks the market price, rolling futures through time
Collateral earns interest while your investment climbs
Break it down, piece by piece
Total returns find their peace
[Outro]
Three rivers flowing into one
Your commodity returns are done
Spot plus roll plus collateral yield
The total treasure that gets revealed