IDEAS home Printed from https://ideas.repec.org/a/wly/jfutmk/v45y2025i9p1100-1133.html
   My bibliography  Save this article

The Silent Disco—Speculation in Bearish Commodity Markets and the Role of Liquidity

Author

Listed:
  • Chanaka N. Ganepola
  • Beyza Mina Ordu‐Akkaya

Abstract

This paper analyzes the possibility of speculative traders influencing the prices of commodity futures in the presence of liquidity constraints. We identify phases of price explosiveness following Phillips, Shi, and Yu and use a series of multinomial logistic models to analyze the influence of speculators on the probability of these explosive price episodes. We find that speculators taking short positions tend to increase the likelihood of negative price explosiveness in most commodities, while those with long positions often reduce the chance of positive price explosions. We also find that the probability of negative price explosiveness is more sensitive to the net short positions held by money managers when both market and funding liquidity are constrained.

Suggested Citation

  • Chanaka N. Ganepola & Beyza Mina Ordu‐Akkaya, 2025. "The Silent Disco—Speculation in Bearish Commodity Markets and the Role of Liquidity," Journal of Futures Markets, John Wiley & Sons, Ltd., vol. 45(9), pages 1100-1133, September.
    • Handle: RePEc:wly:jfutmk:v:45:y:2025:i:9:p:1100-1133
    DOI: 10.1002/fut.22611
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/fut.22611
    Download Restriction: no
    File URL: https://libkey.io/10.1002/fut.22611?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:jfutmk:v:45:y:2025:i:9:p:1100-1133. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.interscience.wiley.com/jpages/0270-7314/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.