Fabio C. Zanini (The University of Illinois, Urbana- Champaign) Philip Garcia (The University of Illinois, Urbana- Champaign)
Abstract
The paper assesses the usefulness of selective hedging strategies when combined with forecast techniques in the live hog contract. The use of routine futures and options hedging is not attractive relative to a cash-only strategy. However, forecasting and hedging can contribute to price risk management improvement for risk-averse producers. Consistent with previous research, the results indicate that the live hog contract continues to offer producers attractive pricing opportunities. The findings suggests that the success of the new lean value carcass contract may depend on its ability to attract trading volume from outside the traditional production sector.
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Publisher Info
Paper provided by EconWPA in its series Finance with number
9712005.
Length: 14 pages Date of creation: 16 Dec 1997 Date of revision: Handle: RePEc:wpa:wuwpfi:9712005
Note: Type of Document - pdf ; prepared on PC; to print on HP Laserjet; pages: 14; figures: included. Office for Futures and Options Research (OFOR) at the University of Illinois, Urbana-Champaign. Working Paper 97-05. For a complete list of OFOR working papers see Contact details of provider: Web page: http://129.3.20.41
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Find related papers by JEL classification: Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
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