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The Use Of Futures Versus Put Options In Pricing Corn Production In Virginia

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  • Kenyon, David E.

Abstract

Corn production pricing results using two futures strategies versus put options were compared using E-V analysis. Pricing 100 percent of expected production at planting with options generated the largest revenues and variances. The larger option strategy variance resulted from higher revenues when harvest prices were low--a desirable outcome.

Suggested Citation

  • Kenyon, David E., 1984. "The Use Of Futures Versus Put Options In Pricing Corn Production In Virginia," 1984 Annual Meeting, August 5-8, Ithaca, New York 279002, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea84:279002
    DOI: 10.22004/ag.econ.279002
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    References listed on IDEAS

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    1. Ronald I. McKinnon, 1967. "Futures Markets, Buffer Stocks, and Income Stability for Primary Producers," Journal of Political Economy, University of Chicago Press, vol. 75(6), pages 844-844.
    2. Black, Fischer, 1976. "The pricing of commodity contracts," Journal of Financial Economics, Elsevier, vol. 3(1-2), pages 167-179.
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