IDEAS home Printed from https://ideas.repec.org/a/oup/ajagec/v71y1989i2p311-318..html
   My bibliography  Save this article

Rollover Hedging and Missing Long-Term Futures Markets

Author

Listed:
  • Bruce L. Gardner

Abstract

Sequential rollover of annual futures positions provides farmers or others with a means of long-term hedging. Consequently, the absence of multiyear futures markets may not be a serious problem. However, year-to-year basis risk exists which can render rollovers ineffective in hedging. Evidence on soybean, corn, and cotton futures suggests that rollovers would be effective at locking in an initial price for a three- to six-year period but would be ineffective in routine hedging over a series of successive three- to six-year periods.

Suggested Citation

  • Bruce L. Gardner, 1989. "Rollover Hedging and Missing Long-Term Futures Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(2), pages 311-318.
    • Handle: RePEc:oup:ajagec:v:71:y:1989:i:2:p:311-318.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.2307/1241588
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Conley, Dennis M. & Almonte-Alvarez, Jaime, 1998. "Long-Term Hedging Analysis For Soybeans, 1973-95," 1998 Annual meeting, August 2-5, Salt Lake City, UT 21006, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    2. E. Neal Blue & Marvin L. Hayenga & Sergio H. Lence & E. Dean Baldwin, 1998. "Futures spread risk in soybean multiyear hedge-to-arrive contracts," Agribusiness, John Wiley & Sons, Ltd., vol. 14(6), pages 467-474.
    3. Akiyama, Takamasa & Baffes, John & Larson, Donald F. & Varangis, Panos, 2003. "Commodity market reform in Africa: some recent experience," Economic Systems, Elsevier, vol. 27(1), pages 83-115, March.
    4. Kletzer, Kenneth M. & Newbery, David M. & Wright, Brian D., 1990. "Alternative instruments for smoothing the consumption of primary commodity exporters," Policy Research Working Paper Series 558, The World Bank.
    5. Jules Sadefo Kamdem & Zoulkiflou Moumouni, 2020. "Comparison of Some Static Hedging Models of Agricultural Commodities Price Uncertainty," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 18(3), pages 631-655, September.
    6. Lapan, Harvey & Moschini, Giancarlo, 1996. "Optimal price policy and the futures markets," Economics Letters, Elsevier, vol. 53(2), pages 175-182, November.
    7. Yoon, Byung-Sam & Brorsen, B. Wade, 2000. "Rollover Hedging," 2000 Conference, April 17-18 2000, Chicago, Illinois 18938, NCR-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management.
    8. Zoulkiflou Moumouni & Jules Sadefo-Kamdem, 2019. "New models of commodity risk hedging according to the behavior of economic decision-makers or Rollover Strategies," Working Papers hal-02417459, HAL.
    9. Tomek, William G. & Peterson, Hikaru Hanawa, 2000. "Risk Management In Agricultural Markets: A Survey," 2000 Producer Marketing and Risk Management Conference, January 13-14, Orlando, FL 19580, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

    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:oup:ajagec:v:71:y:1989:i:2:p:311-318.. 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: Oxford University Press (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

    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.