Commodity Exchange Market Research Articles

Futures Trading in Agricultural Commodities: Effects of the Ban on Selected Commodities in India

The commodity market is one of the emerging markets in today‟s economy. Given that inflation is increasing alarmingly and the emergence of risk in all activities, the commodity market has a phenomenal contribution to the overall economy of India. The following paper – Futures Trading in Agricultural Commodities: Effects of the ban on selected commodities in India shall focus on the impact of hedging (risk management) and price discovery, which are two major aspects under the agricultural commodity market. Secondary data from two main sources namely the Multi Commodity Exchange Market and National Commodity Derivatives Exchange were used for analysis. The ban on futures trading under agricultural commodities that was implemented by the Government of India shall be dealt with specifically taking seven commodities – Wheat, Rice, Sugar, Chickpea, Potato, Rubber and Guar Seeds. The common element between all these commodities is that they were all banned from futures trading at some point of time or the other. An analysis using econometric and statistical tools shall be performed to check whether there exists any sort of relationship between the ban and the prevailing inflation in the economy and also the correlation between the prices before and after ban. This is purely an explanatory study wherein the strategies for buyers and sellers in the futures market will also be discussed.Keywords: Hedging, ban, futures trading, inflation

Contagion Effect Analysis of Financial Crisis in Soybean Futures Markets Based on Copula Functions

Using five kinds of Copula functions to investigate the changes of correlations among soybean futures in Tokyo Grain Exchange, Chicago Board of Trade and Dalian Commodity Exchange market before and after the financial crisis caused by American subprime mortgage, this paper verifies the existence of contagion effect of this crisis in the international soybean futures markets.