The major finding is that liquidity costs in futures options market are two to three times higher than liquidity costs in the futures market. Liquidity cost is one potential factor to consider when choosing between hedging with a futures contract or with an option contract. While there is...

This study compares liquidity costs and other characteristics of electronic and open outcry hard red winter wheat futures contracts traded on the Kansas City Board of Trade. Liquidity costs are considerably lower in the electronic market than in the open outcry market. A new approach is used to...

This study compares liquidity costs of electronic and open-outcry wheat futures contracts traded side-by-side on the Kansas City Board of Trade. Liquidity costs are considerably lower in the electronic market. Liquidity costs in the electronic market are still considerably lower after...

This study compares liquidity costs in options and futures markets. Considerable research has estimated liquidity costs of futures trading, but there is little comparable research about futures options markets. The study uses transaction prices for stock futures and options contracts traded at...

The purpose of this paper is to determine the importance of the strength and weakness of basis and futures prices as barometers for producers to use in deciding whether to store or not. Basis is the single most important market signal for wheat producers to use when deciding whether to store or...

Years of research have been dedicated to determining the best time for producers to sell their commodities. Researchers have developed basis models, market efficiency tests, hedging/risk models, price forecasting models, and many other models in an attempt to help producers. There is a vast...

Aggregate data are commonly used to determine returns to storage. However, recent studies have shown that aggregating data may lead to underestimated returns. This article compares aggregate and elevator data from Oklahoma to determine if aggregate data underestimate returns. We find no...

There has been considerable normative research about how farmers should make marketing decisions, but little positive research on what farmers really do. Regressions of gender, total volume, timing, and frequency of sales on the average weighted price received are used to test hypotheses...

Behavioral finance is a relatively new field of inquiry that may help better understand farmer marketing. The theory argues that people tend to make certain psychological biases that cause them to not be fully rational in an economic sense. For example, people tend to be about twice as upset...

Futures prices when combined with a basis forecast provide a reliable way to forecast cash prices. The most popular method of forecasting basis is historical moving averages. Given the recent failure of longer moving averages proposed by previous studies, this research reassesses past...