This document summarizes a research study that analyzed whether future prices of olein commodities traded on the Jakarta Futures Exchange can be predicted using spot and forward prices from 2015-2017. The study found that forward prices did not affect future prices, while spot prices did have a significant impact on predicting future prices. Thus, the spot price was determined to be the best predictor of future prices for olein commodities traded on the Jakarta Futures Exchange during the period examined. The document provides background on commodity futures trading, definitions of key terms like spot prices, forward prices and future prices, prior relevant research, and an overview of the methodology and findings of the research study.
100830724 project-on-commodity-market-vishnu-mantriRushabh Shah
The document provides an overview of commodity markets, including:
1. It defines key terms like commodity, commodity exchange, and commodity futures. Commodities are standardized goods or products that are traded, while a commodity exchange facilitates futures trading in licensed commodities.
2. It outlines the history and evolution of commodity markets, tracing their origins to organized trading of rice tickets in Japan in the 1800s and futures trading of wheat in Chicago in 1848.
3. It discusses the development of commodity markets in India, including futures trading of cotton starting in 1875, as well as the banning of some derivatives after independence in 1952.
The document provides an overview of derivatives transactions in India. It discusses the types of derivative markets including exchange traded and over-the-counter markets. It also describes the main types of traders in derivatives markets - hedgers who aim to reduce risk, speculators who take on risk to profit from price movements, and arbitrageurs who seek to profit from pricing discrepancies. Finally, it outlines the most common types of derivative contracts including forwards, futures, options, and swaps.
This document discusses testing the strong and weak forms of purchasing power parity (PPP) between Jordan and its major trading partners (Japan, UK, Turkey, and US) from 2000-2012. It first examines the strong form of PPP by testing if the real exchange rate is stationary, finding it is nonstationary, implying long-run PPP does not hold. It then uses Johansen cointegration tests to examine the weak form of PPP, finding a cointegrating relationship between exchange rates and domestic/foreign price levels, providing evidence that weak PPP holds between Jordan and its trading partners. The document reviews literature on PPP testing and discusses the methodology used, including specifications for testing the strong and weak forms.
The document provides an overview of the derivatives market in India. It discusses key concepts like forwards, futures, options, and swaps. It outlines the evolution of the derivatives market in India, from the first steps taken in 1995 to remove prohibitions on options trading, to the establishment of a regulatory framework by SEBI and the launch of index futures and options trading on exchanges like NSE and BSE in 2000. The needs served by derivatives markets are also summarized, such as risk transfer, price discovery, and increasing market volumes. Common participants like hedgers, speculators, arbitrageurs and spreaders are defined. Examples of popular derivatives products available on Indian exchanges are also provided.
A STUDY ON EQUITY & EQUITY DERIVATIVE - INDIAN SECURITIES MARKETYashmin Revawala
This document appears to be a student project report on equity and equity derivatives in the Indian securities market. It includes sections on an overview of the Indian securities market, identification of stocks from the CNX NIFTY index for investment purposes, comparing returns on investment in the CNX NIFTY index and selected stocks, using portfolio management techniques to further increase returns, an overview of the equity derivative market in India, and comparing the cash and derivative markets to analyze their impact on each other. The student also uses pivot points to predict future derivative prices and evaluates the accuracy of this prediction method.
A project report on commodity futures and awareness level of commodity market...Babasab Patil
The document provides information about a project report on commodity futures and the awareness level of the commodity market at Geojit Financial Service Ltd. in Bangalore. It discusses commodity derivatives like futures, forwards, options, and swaps. It finds that most customers prefer to invest in commodities like gold, silver, and crude oil due to higher returns but are not fully aware of how the commodity market works. The objectives are to understand the commodity market and futures contracts, study pricing, find awareness levels, and potential customers. It conducted surveys in Bangalore and found that deciding prices using formulas can be inaccurate and more awareness is needed among farmers and investors.
This document is a presentation on a study of the commodity market in Arihant Capital Market Ltd. It includes an introduction to financial markets and commodities. It discusses the objectives of studying customers' perceptions of commodity trading. Research methodology included a survey of 200 respondents in Ahmedabad on their commodity investment habits and preferences. Key findings were that most monitor investments monthly/daily, prefer short-term trading, and invest between Rs. 200,000-400,000 income. Most respondents had a graduate degree. In conclusion, commodity investing provides higher returns than banking but is also higher risk.
100830724 project-on-commodity-market-vishnu-mantriRushabh Shah
The document provides an overview of commodity markets, including:
1. It defines key terms like commodity, commodity exchange, and commodity futures. Commodities are standardized goods or products that are traded, while a commodity exchange facilitates futures trading in licensed commodities.
2. It outlines the history and evolution of commodity markets, tracing their origins to organized trading of rice tickets in Japan in the 1800s and futures trading of wheat in Chicago in 1848.
3. It discusses the development of commodity markets in India, including futures trading of cotton starting in 1875, as well as the banning of some derivatives after independence in 1952.
The document provides an overview of derivatives transactions in India. It discusses the types of derivative markets including exchange traded and over-the-counter markets. It also describes the main types of traders in derivatives markets - hedgers who aim to reduce risk, speculators who take on risk to profit from price movements, and arbitrageurs who seek to profit from pricing discrepancies. Finally, it outlines the most common types of derivative contracts including forwards, futures, options, and swaps.
This document discusses testing the strong and weak forms of purchasing power parity (PPP) between Jordan and its major trading partners (Japan, UK, Turkey, and US) from 2000-2012. It first examines the strong form of PPP by testing if the real exchange rate is stationary, finding it is nonstationary, implying long-run PPP does not hold. It then uses Johansen cointegration tests to examine the weak form of PPP, finding a cointegrating relationship between exchange rates and domestic/foreign price levels, providing evidence that weak PPP holds between Jordan and its trading partners. The document reviews literature on PPP testing and discusses the methodology used, including specifications for testing the strong and weak forms.
The document provides an overview of the derivatives market in India. It discusses key concepts like forwards, futures, options, and swaps. It outlines the evolution of the derivatives market in India, from the first steps taken in 1995 to remove prohibitions on options trading, to the establishment of a regulatory framework by SEBI and the launch of index futures and options trading on exchanges like NSE and BSE in 2000. The needs served by derivatives markets are also summarized, such as risk transfer, price discovery, and increasing market volumes. Common participants like hedgers, speculators, arbitrageurs and spreaders are defined. Examples of popular derivatives products available on Indian exchanges are also provided.
A STUDY ON EQUITY & EQUITY DERIVATIVE - INDIAN SECURITIES MARKETYashmin Revawala
This document appears to be a student project report on equity and equity derivatives in the Indian securities market. It includes sections on an overview of the Indian securities market, identification of stocks from the CNX NIFTY index for investment purposes, comparing returns on investment in the CNX NIFTY index and selected stocks, using portfolio management techniques to further increase returns, an overview of the equity derivative market in India, and comparing the cash and derivative markets to analyze their impact on each other. The student also uses pivot points to predict future derivative prices and evaluates the accuracy of this prediction method.
A project report on commodity futures and awareness level of commodity market...Babasab Patil
The document provides information about a project report on commodity futures and the awareness level of the commodity market at Geojit Financial Service Ltd. in Bangalore. It discusses commodity derivatives like futures, forwards, options, and swaps. It finds that most customers prefer to invest in commodities like gold, silver, and crude oil due to higher returns but are not fully aware of how the commodity market works. The objectives are to understand the commodity market and futures contracts, study pricing, find awareness levels, and potential customers. It conducted surveys in Bangalore and found that deciding prices using formulas can be inaccurate and more awareness is needed among farmers and investors.
This document is a presentation on a study of the commodity market in Arihant Capital Market Ltd. It includes an introduction to financial markets and commodities. It discusses the objectives of studying customers' perceptions of commodity trading. Research methodology included a survey of 200 respondents in Ahmedabad on their commodity investment habits and preferences. Key findings were that most monitor investments monthly/daily, prefer short-term trading, and invest between Rs. 200,000-400,000 income. Most respondents had a graduate degree. In conclusion, commodity investing provides higher returns than banking but is also higher risk.
Stock return and volatility evidence from indian stock marketROHITH U J
The risk appetite of investors governs their investment in financial instruments. Persons who are minimum risk takers with return generally park their money in secure instruments but people with a higher risk appetite generally invest in a stock market financial instrument to achieve their financial goal. Investors with a higher risk appetite have to measure the market performance in the basis of risk and return so that they can alter their portfolio to keep pace with current market movement. In this research intended to study risk in terms of standard deviation and beta of all sectoral indices of NSE with respect to nifty and their performance in different time horizon and ranked them accordingly in terms of mean return and found out the best performing sector in a given time frame
This document provides an overview of the evolution and development of the Indian capital market. It discusses how stock markets originated in major Indian cities like Bombay, Calcutta, and Madras in the late 1800s as commercial enterprises grew. The stock exchanges in these cities were formally established in the late 1800s and early 1900s. The document then outlines some of the major booms and slumps that occurred over subsequent decades in various industries like cotton, jute, tea, and coal, and how this impacted the growth of regional stock exchanges across India.
This project report summarizes a study on the currency futures market in India conducted by two MBA students, Milan Adodariya and Khima Goraniya, at Anagram Capital as part of their summer training. The report includes an introduction, literature review, research methodology, data collection and analysis sections. It also provides an overview of the foreign exchange market, history of currency futures in India, company and industry profiles, findings from surveys conducted, and conclusions.
An economic analysis on exchange rate and economic growth in bangladeshMahmudur Rahman
This document analyzes the effects of exchange rate changes on economic growth in Bangladesh. It uses econometric analysis and data from 1981-2013 to estimate the relationship between GDP growth, exchange rates, and exports. The results show that in the long run, a 10% depreciation of the real exchange rate is associated with a 3.2% rise in GDP. However, in the short run the same depreciation results in about a 0.5% decline in GDP. The document recommends Bangladesh pursue exchange rate policies that allow for gradual depreciation to avoid short-term contraction while enabling long-term competitiveness and growth.
The document discusses a report submitted by Yogesh Moule on the fundamentals of derivatives with a focus on currency derivatives. It includes declarations signed by Yogesh and his mentor certifying the project's authenticity and that it fulfills requirements for Yogesh's PGDM program at Indus Business Academy. The report also provides information on Religare Securities Limited where Yogesh completed his summer internship project.
A summer training project report presentation ondimpishah1989
This document summarizes a presentation on derivatives, specifically futures and options, given at JM Financial Services Ltd. It provides an overview of JM Financial as a large Indian broking firm, introduces various derivative products like forwards, futures, and options. It describes how futures and options are traded on exchanges, including details on contracts, expiration cycles, and pricing. It also outlines the three main types of derivative traders - hedgers who minimize risk, speculators who bet on market movements, and arbitrageurs who profit from pricing discrepancies. The conclusion emphasizes how derivatives allow participants to convert unlimited risks to limited ones and serve as risk management tools.
A study on equity & equity derivative indian securities marketYashmin Revawala
*EQUITY:
1. Selection of Stocks using the 10 steps Process
2. Comparison of return on stocks and NIFTY BeES
3. Using Portfolio Management for increasing the return on investment
*EQUITY DERIVATIVE:
1. The impact of cash market segment on derivative market using settlement price and the value of underlying equity.
2. Predicting the cash market index (CNX NIFTY) & underlying index (FUTIDX NIFTY) using PIVOT POINT Method
The document provides an introduction to commodity futures markets. It defines key terms related to commodity trading such as futures contracts, arbitrage, contango, clearinghouses. It also summarizes the history and development of commodity markets in India, including the present regulatory structure with the Forward Markets Commission overseeing three national commodity exchanges.
A project on derivatives market in indiaProjects Kart
A project on derivatives market in India report goes beyond that the local derivative in the emerging markets have witnessed widespread use of the derivative instrument for a variety of reasons. This continuous growth and development by the emerging market participants has resulted in capital inflows as well as helped the investors in risk protection through hedging. Visit: http://www.projectskart.com/p/contact-us.html for more information.
Summer intern Project "Study on Commodity Trading and Investments"chezhiang
The study and analysis that involves:
•concepts of commodities trading in india.
•various trends in commodity trading investments.
•role of commodities in indian financial markets.
•present situation of the commodities in indian market and suggest for any improvements thereafter.
Financial derivatives have grown enormously over the past decade as a way to differentiate and allocate risk. Derivatives are financial contracts whose value is dependent on an underlying asset such as a stock, bond, commodity, currency, interest rate or index. There are several types of derivatives including forwards, futures, options, and swaps. Derivatives allow risk to be traded in financial markets and help companies and investors to hedge against risk.
The document provides an overview of the history and development of commodity markets in India. It discusses how commodity exchanges originated in Chicago in the 1840s and later spread to other parts of the developing world in the 1980s-1990s. It then focuses on the evolution of commodity markets in India, from over 20 regional exchanges prior to a ban in the 1960s to the emergence of national electronic exchanges today. The document also summarizes current trading volumes and provides examples of trading processes for futures, spot, and delivery-based commodities.
This document provides an overview of Bangladesh's trade balance from 2013-2017. It discusses key aspects of Bangladesh's economy including imports, exports, GDP growth, and economic indicators. The main points are:
- Bangladesh has had a negative trade balance every year, with imports exceeding exports. While the trade deficit decreased in 2014 and 2016, it increased sharply in 2017.
- The economy is growing at a rapid pace, with GDP growth of over 6% annually since 1996. However, factors like infrastructure issues, corruption, and power shortages pose challenges.
- Ready-made garments make up over 80% of exports. Major export partners are the EU, US, and India. Imports have grown significantly due
Indian markets have recently opened commodity derivatives, allowing retail investors to participate in commodity trading. Commodities such as copper, corn, and crude oil are traded on regulated exchanges like NCDEX, MCX, and NMCE. There are two main markets - the spot market where physical commodities are bought and sold for cash, and the futures market where contracts are made to buy/sell commodities at a future date and price. Exchanges have circuit filters of up to 6% to prevent large price fluctuations. Commodity derivatives provide exposure through futures, exchange traded funds, stocks of commodity companies, and mutual funds.
Awareness of commodity market a project report on mba financeBabasab Patil
This document provides information about Karvy, a financial services firm in India. It discusses Karvy's history beginning in 1981 as a small group of accountants [1]. Over the past 20 years, Karvy has grown into a premier integrated financial services provider through quality services, innovations, and a focus on customers [2]. Karvy offers a wide range of financial services including stock broking, depository services, distribution of financial products, insurance broking, commodities broking, and more [3].
This document discusses currency futures trading in India. It provides background on currency futures markets globally and how they were introduced in India in 2008. Currency futures allow investors to hedge foreign exchange risk in a transparent and efficient manner. Trading has grown substantially since introduction, with the National Stock Exchange seeing a 1200% increase in daily trading volumes from September 2008 to June 2009. Currency futures provide benefits to both retail and institutional investors in India.
Finance project report on a study on financial derivatives ...Mba projects free
This document is a study on financial derivatives (futures and options) submitted for a Master's degree in Business Administration. It discusses the emergence and growth of derivatives markets as a way for economic agents to hedge against price risks. Derivatives derive their value from an underlying asset and are used by banks, firms, and investors for hedging, speculation, and arbitrage. The main types of derivatives are futures, options, warrants, LEAPS, baskets, and swaps. The study analyzes derivatives trading in India and examines how it impacts market volatility.
This document is a summer training project report submitted by Abhishek Sukhwal for their MBA program. The report focuses on studying commodity markets in India. It includes an introduction to commodity markets, definitions of commodities, the need for commodity markets in India, descriptions of major commodity exchanges in the country like NCDEX, MCX, and NMCEIL. The report consists of chapters on commodity futures contracts, commodity trading, participants in commodity markets, and the regulatory framework for commodity trading in India. It aims to analyze commodity markets and provide conclusions and recommendations.
Commodity market with marwadi shares & finance ltd by rohit parmarJagriti Sharma
The document is a project report submitted to Pune University on studying the commodity market. It includes an acknowledgement, table of contents, executive summary and introduction on commodity derivatives and risk management tools used in commodity trading. The report was submitted by Rohit Parmar in 2006-2008 as part of his MBA course requirement and was guided by Prof. Mahesh Halale.
THE EFFECT OF STOCK PRICES ON INVESTING DECISIONS IN BANDARMOLOGY MODERATION ...indexPub
The capital market becomes an effective means for a country's economic development. Because with the progress of the world, the Indonesian capital market will increase the amount of capital in the country and the development of the capital market also plays an important role in encouraging the country's economy. Currently, the number of investors in Indonesia continues to increase every year, most recently at the end of 2022, the number of investors in Indonesia has reached 10.31 million investors. Where the majority of investors in the capital market are dominated by young people with an age range under 30 years, and with an educational profile are high school graduates. This is a positive signal, considering that with these demographics, the capital market in Indonesia in the future will still have the next generation. However, in reality the growing investment in Indonesia is often dominated by price manipulation practices, such as fried stocks. So that in this study descriptive quantitative research methods were used. Where this study aims to determine the perception of students who will become potential investors in understanding related to Bandarmology influencing decision making in investing. The sample collection technique in this study uses proportionate random sampling in adolescents with undergraduate education at the Faculty of Economics, who have invested in East Java.
The document provides an overview of the Indian derivatives market. It discusses key components such as the structure of securities markets, derivatives trading, and the components that make up the derivatives market. It also covers current trends in derivatives globally and in India, including growth in market size. Details on options and futures trading in India are given. The document discusses consumer profiles, how derivatives are traded, typical trading time frames, and growth in key market segments. It provides an analysis of top stock broking firms in India. [/SUMMARY]
Stock return and volatility evidence from indian stock marketROHITH U J
The risk appetite of investors governs their investment in financial instruments. Persons who are minimum risk takers with return generally park their money in secure instruments but people with a higher risk appetite generally invest in a stock market financial instrument to achieve their financial goal. Investors with a higher risk appetite have to measure the market performance in the basis of risk and return so that they can alter their portfolio to keep pace with current market movement. In this research intended to study risk in terms of standard deviation and beta of all sectoral indices of NSE with respect to nifty and their performance in different time horizon and ranked them accordingly in terms of mean return and found out the best performing sector in a given time frame
This document provides an overview of the evolution and development of the Indian capital market. It discusses how stock markets originated in major Indian cities like Bombay, Calcutta, and Madras in the late 1800s as commercial enterprises grew. The stock exchanges in these cities were formally established in the late 1800s and early 1900s. The document then outlines some of the major booms and slumps that occurred over subsequent decades in various industries like cotton, jute, tea, and coal, and how this impacted the growth of regional stock exchanges across India.
This project report summarizes a study on the currency futures market in India conducted by two MBA students, Milan Adodariya and Khima Goraniya, at Anagram Capital as part of their summer training. The report includes an introduction, literature review, research methodology, data collection and analysis sections. It also provides an overview of the foreign exchange market, history of currency futures in India, company and industry profiles, findings from surveys conducted, and conclusions.
An economic analysis on exchange rate and economic growth in bangladeshMahmudur Rahman
This document analyzes the effects of exchange rate changes on economic growth in Bangladesh. It uses econometric analysis and data from 1981-2013 to estimate the relationship between GDP growth, exchange rates, and exports. The results show that in the long run, a 10% depreciation of the real exchange rate is associated with a 3.2% rise in GDP. However, in the short run the same depreciation results in about a 0.5% decline in GDP. The document recommends Bangladesh pursue exchange rate policies that allow for gradual depreciation to avoid short-term contraction while enabling long-term competitiveness and growth.
The document discusses a report submitted by Yogesh Moule on the fundamentals of derivatives with a focus on currency derivatives. It includes declarations signed by Yogesh and his mentor certifying the project's authenticity and that it fulfills requirements for Yogesh's PGDM program at Indus Business Academy. The report also provides information on Religare Securities Limited where Yogesh completed his summer internship project.
A summer training project report presentation ondimpishah1989
This document summarizes a presentation on derivatives, specifically futures and options, given at JM Financial Services Ltd. It provides an overview of JM Financial as a large Indian broking firm, introduces various derivative products like forwards, futures, and options. It describes how futures and options are traded on exchanges, including details on contracts, expiration cycles, and pricing. It also outlines the three main types of derivative traders - hedgers who minimize risk, speculators who bet on market movements, and arbitrageurs who profit from pricing discrepancies. The conclusion emphasizes how derivatives allow participants to convert unlimited risks to limited ones and serve as risk management tools.
A study on equity & equity derivative indian securities marketYashmin Revawala
*EQUITY:
1. Selection of Stocks using the 10 steps Process
2. Comparison of return on stocks and NIFTY BeES
3. Using Portfolio Management for increasing the return on investment
*EQUITY DERIVATIVE:
1. The impact of cash market segment on derivative market using settlement price and the value of underlying equity.
2. Predicting the cash market index (CNX NIFTY) & underlying index (FUTIDX NIFTY) using PIVOT POINT Method
The document provides an introduction to commodity futures markets. It defines key terms related to commodity trading such as futures contracts, arbitrage, contango, clearinghouses. It also summarizes the history and development of commodity markets in India, including the present regulatory structure with the Forward Markets Commission overseeing three national commodity exchanges.
A project on derivatives market in indiaProjects Kart
A project on derivatives market in India report goes beyond that the local derivative in the emerging markets have witnessed widespread use of the derivative instrument for a variety of reasons. This continuous growth and development by the emerging market participants has resulted in capital inflows as well as helped the investors in risk protection through hedging. Visit: http://www.projectskart.com/p/contact-us.html for more information.
Summer intern Project "Study on Commodity Trading and Investments"chezhiang
The study and analysis that involves:
•concepts of commodities trading in india.
•various trends in commodity trading investments.
•role of commodities in indian financial markets.
•present situation of the commodities in indian market and suggest for any improvements thereafter.
Financial derivatives have grown enormously over the past decade as a way to differentiate and allocate risk. Derivatives are financial contracts whose value is dependent on an underlying asset such as a stock, bond, commodity, currency, interest rate or index. There are several types of derivatives including forwards, futures, options, and swaps. Derivatives allow risk to be traded in financial markets and help companies and investors to hedge against risk.
The document provides an overview of the history and development of commodity markets in India. It discusses how commodity exchanges originated in Chicago in the 1840s and later spread to other parts of the developing world in the 1980s-1990s. It then focuses on the evolution of commodity markets in India, from over 20 regional exchanges prior to a ban in the 1960s to the emergence of national electronic exchanges today. The document also summarizes current trading volumes and provides examples of trading processes for futures, spot, and delivery-based commodities.
This document provides an overview of Bangladesh's trade balance from 2013-2017. It discusses key aspects of Bangladesh's economy including imports, exports, GDP growth, and economic indicators. The main points are:
- Bangladesh has had a negative trade balance every year, with imports exceeding exports. While the trade deficit decreased in 2014 and 2016, it increased sharply in 2017.
- The economy is growing at a rapid pace, with GDP growth of over 6% annually since 1996. However, factors like infrastructure issues, corruption, and power shortages pose challenges.
- Ready-made garments make up over 80% of exports. Major export partners are the EU, US, and India. Imports have grown significantly due
Indian markets have recently opened commodity derivatives, allowing retail investors to participate in commodity trading. Commodities such as copper, corn, and crude oil are traded on regulated exchanges like NCDEX, MCX, and NMCE. There are two main markets - the spot market where physical commodities are bought and sold for cash, and the futures market where contracts are made to buy/sell commodities at a future date and price. Exchanges have circuit filters of up to 6% to prevent large price fluctuations. Commodity derivatives provide exposure through futures, exchange traded funds, stocks of commodity companies, and mutual funds.
Awareness of commodity market a project report on mba financeBabasab Patil
This document provides information about Karvy, a financial services firm in India. It discusses Karvy's history beginning in 1981 as a small group of accountants [1]. Over the past 20 years, Karvy has grown into a premier integrated financial services provider through quality services, innovations, and a focus on customers [2]. Karvy offers a wide range of financial services including stock broking, depository services, distribution of financial products, insurance broking, commodities broking, and more [3].
This document discusses currency futures trading in India. It provides background on currency futures markets globally and how they were introduced in India in 2008. Currency futures allow investors to hedge foreign exchange risk in a transparent and efficient manner. Trading has grown substantially since introduction, with the National Stock Exchange seeing a 1200% increase in daily trading volumes from September 2008 to June 2009. Currency futures provide benefits to both retail and institutional investors in India.
Finance project report on a study on financial derivatives ...Mba projects free
This document is a study on financial derivatives (futures and options) submitted for a Master's degree in Business Administration. It discusses the emergence and growth of derivatives markets as a way for economic agents to hedge against price risks. Derivatives derive their value from an underlying asset and are used by banks, firms, and investors for hedging, speculation, and arbitrage. The main types of derivatives are futures, options, warrants, LEAPS, baskets, and swaps. The study analyzes derivatives trading in India and examines how it impacts market volatility.
This document is a summer training project report submitted by Abhishek Sukhwal for their MBA program. The report focuses on studying commodity markets in India. It includes an introduction to commodity markets, definitions of commodities, the need for commodity markets in India, descriptions of major commodity exchanges in the country like NCDEX, MCX, and NMCEIL. The report consists of chapters on commodity futures contracts, commodity trading, participants in commodity markets, and the regulatory framework for commodity trading in India. It aims to analyze commodity markets and provide conclusions and recommendations.
Commodity market with marwadi shares & finance ltd by rohit parmarJagriti Sharma
The document is a project report submitted to Pune University on studying the commodity market. It includes an acknowledgement, table of contents, executive summary and introduction on commodity derivatives and risk management tools used in commodity trading. The report was submitted by Rohit Parmar in 2006-2008 as part of his MBA course requirement and was guided by Prof. Mahesh Halale.
THE EFFECT OF STOCK PRICES ON INVESTING DECISIONS IN BANDARMOLOGY MODERATION ...indexPub
The capital market becomes an effective means for a country's economic development. Because with the progress of the world, the Indonesian capital market will increase the amount of capital in the country and the development of the capital market also plays an important role in encouraging the country's economy. Currently, the number of investors in Indonesia continues to increase every year, most recently at the end of 2022, the number of investors in Indonesia has reached 10.31 million investors. Where the majority of investors in the capital market are dominated by young people with an age range under 30 years, and with an educational profile are high school graduates. This is a positive signal, considering that with these demographics, the capital market in Indonesia in the future will still have the next generation. However, in reality the growing investment in Indonesia is often dominated by price manipulation practices, such as fried stocks. So that in this study descriptive quantitative research methods were used. Where this study aims to determine the perception of students who will become potential investors in understanding related to Bandarmology influencing decision making in investing. The sample collection technique in this study uses proportionate random sampling in adolescents with undergraduate education at the Faculty of Economics, who have invested in East Java.
The document provides an overview of the Indian derivatives market. It discusses key components such as the structure of securities markets, derivatives trading, and the components that make up the derivatives market. It also covers current trends in derivatives globally and in India, including growth in market size. Details on options and futures trading in India are given. The document discusses consumer profiles, how derivatives are traded, typical trading time frames, and growth in key market segments. It provides an analysis of top stock broking firms in India. [/SUMMARY]
IRJET- A Study on Emerging Trends in Indian Derivative MarketIRJET Journal
This document provides an overview of emerging trends in the Indian derivative market. It discusses how derivative markets positively contribute to economic development in India by helping address risks in financial transactions. The paper examines the types of derivative instruments like forwards, futures, options, and swaps. It analyzes the derivative market in India, how trading works, and the risks involved. The key points are that derivatives markets have grown significantly in India since 2000 and help with price discovery, risk management, and efficient capital allocation, though trading carries risks that investors must understand.
This document is a dissertation report submitted to Uttarakhand Technical University by Gaurav Pandey on the topic of "Study of Derivatives Market in India". The report includes an introduction to the financial services industry and derivatives markets. It discusses the objectives of studying derivatives to analyze futures and options operations and understand how derivatives can help manage risks. The report will analyze profits and losses in cash and derivatives markets and the role of derivatives in the Indian financial market.
This document provides information about currency futures trading on the MCX Stock Exchange (MCX-SX) in India. It discusses what currency futures are and how they can be used to hedge against currency risk. It also outlines the key participants in the currency futures market, including hedgers, investors, and arbitrageurs. Finally, it provides product specifications and frequently asked questions about the USDINR, EURINR, GBPINR, and JPYINR currency futures contracts available on MCX-SX.
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This document is a study on financial derivatives (futures and options) submitted for a Master of Business Administration degree. It discusses the emergence of derivatives markets as a way for economic agents to hedge against price fluctuations in underlying assets. Derivatives derive their value from an underlying asset like stocks, indexes, bonds, currencies, or interest rates. The study aims to analyze futures and options transactions, examine profit/loss for buyers/sellers and writers/holders, and evaluate risk management with derivatives. It focuses on the Indian context using data from the National Stock Exchange of India.
Understanding Stock Returns as a Combination of Speculative and Fundamental G...ijtsrd
The Indian stock market returns are largely speculative in nature. Taking twenty stocks off of the Sensex, the Total return of the stock was split into the fundamentally arising returns and the speculative return. This revealed the speculative nature of the Indian Stock market. What this means is that, the good stocks with strong fundamentals may have a low total return as a result of low speculative returns, similarly fundamentally weak stocks may potentially have high speculative returns, resulting in high total returns. Thus, a bifurcation of this sort can help investors with different investment objectives, horizons and risk appetite, invest to achieve their goals. Sanishtha Bhatia | Anshika Lara | Danvi Shah | Shanav Jalan | Shreejit Sawant "Understanding Stock Returns as a Combination of Speculative and Fundamental Growth: An Emperical Study" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-4 | Issue-5 , August 2020, URL: https://www.ijtsrd.com/papers/ijtsrd31742.pdf Paper Url :https://www.ijtsrd.com/economics/finance/31742/understanding-stock-returns-as-a-combination-of-speculative-and-fundamental-growth-an-emperical-study/sanishtha-bhatia
Impact of Accounting Information on Stock Price Volatility (A Study of Select...inventionjournals
This document summarizes a research study that examined the impact of accounting information on stock price volatility of selected quoted manufacturing companies in Nigeria from 2005-2014. The study used annual report data from 5 manufacturing companies, including earnings per share, book value per share, price-earnings ratio, and dividend per share. The results of the analysis found that accounting information has a strong positive significant impact on stock price volatility. Therefore, reliable accounting information is important for investors to make informed decisions and for companies to have less volatile stock prices. The study recommends proper regulation of accounting information disclosure to increase transparency.
1. The document discusses the growth and development of derivatives markets in India, including key milestones like SEBI permitting derivatives trading on Indian stock exchanges in 2000 and the introduction of various derivatives products over subsequent years.
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1. American International Journal of Business Management (AIJBM)
ISSN- 2379-106X, www.aijbm.com Volume 2, Issue 4 (April - 2019), PP 46-51
*Corresponding Author: www.aijbm.com 46 | Page
Posma Sariguna Johnson Kennedy1
Is the Future Price can be Predicted through Spot and Forward
Price?
Posma Sariguna Johnson Kennedy1
, Melina Geni2
1
Faculty of Economics and Business, Universitas Kristen Indonesia, Jakarta, Indonesia
2
Facultyof Economics and Business, Universitas Kristen Indonesia, Jakarta, Indonesia
*Corresponding Author: Posma Sariguna Johnson Kennedy
ABSTRACT: The purpose of this study is to see the effect of spot and forward prices on futures prices on
olein products on the Bursa Berjangka Jakarta or Jakarta Futures Exchange (JFX) for the 2015-2017 period.
The research method used by the quantitative approach. The data used are secondary data, obtained from
bappebti.co.id and jfx.co.id. The results of this study indicate that forward rates do not affect futures rates,
while spot rates affect the futures rates. Thus the spot price is the best predictor in predicting futures prices.
KEYWORDS -Forward Prices, Spot Prices, Future Prices, Olein Commodity, Jakarta Futures Exchange
I. INTRODUCTION
In every form of investment always presents two sides of outcome, namely the risk of losses or get
potential profits. Investment in commodity futures trading is known as a form of investment that has a high risk
and has the potential to provide high profits in a relatively short time. In futures trading, a customer does not
need to deposit money as much as the value of the contract traded, but only in a small percentage ranges from 3-
5% of the contract value. This amount of money is called the margin. Every time the customer can release or
sell the contract before the contract is due. However, as a customer, they must keep in mind that the buying and
selling transaction that is involved is a business that not only assesses the margin deposited but the value of the
contract. Thus, if there is a change in the price of a commodity which is subject to a contract in the market up by
several percents, the customer may get a huge profit or loss, so that the deposited margin can multiply or
disappear in a short time. These risks are what investors face in the Commodity Futures Trading. That is what
causes the Commodity Futures Trading to be a type of high-risk trade.[1]
The Commodity Futures Trading contract is a standard contract where the amount, quality, type, place
and time of delivery have been determined in advance. If an analys can be carried out carefully by applicable
rules, investing in the Commodity Futures Trading is likely to give good results. Potential commodity futures
and trade indications as an attractive investment alternative can be seen from the increasing number of lots
transacted on Jakarta Futures Exchange, from year to year which shows that the average trade transaction
experienced very significant growth.[1]
Commodity Futures Trading in Indonesia uses the basis of Law No.32/1997 as amended by Law No.
10/2011, concerning Commodity Futures Trading is everything related to commodity buying and selling with
margin withdrawals with settlement then based on futures contracts, sharia derivative contracts and or other
derivative contracts. The commodity in this law regulated by the regulation of the Head of Badan Pengawas
Perdagangan Berjangka Komoditi (BAPPEBTI)orThe Commodity Futures Trading Regulatory Agency.
Historically, the commodities transacted began with primary products such as agricultural, mining and energy
products, and now include various financial products such as the stock index and foreign currency (cross
currency).[1]
At present, Indonesia has two Futures Exchanges, namely the Bursa Efek Jakarta (BBJ) or the Jakarta
Futures Exchange (JFX) which began operations at the end of 2000, and the Indonesian Bursa Derivative
Commodity Exchange (BKDI) which began operations in 2009. Since its inception, BBJ and BKDI offer a
forum for Commodity Futures Trading transactions that can meet national needs by following global trends.
This is so that the Commodity Futures Trading market players in Indonesia can conduct transactions on BBJ and
BKDI as well as the Commodity Futures Trading market participants in the Futures Exchange in various cities
throughout the world. Thus, every user both as an investor and a local hedger has the opportunity to take
advantage of the existence of BBJ and BKDI as in other Futures Exchanges throughout the world.
During 2015, commodity futures trading transactions reached 5,490,430 lots, an increase of 6.11%
from the previous year, amounting to 1,059,145 lots to 1,360,601 lots. The multilateral contract that dominates
the trade is CPO with 439,635 lots, robusta coffee 233,712 lots and gold 250 grams 129,023 lots. Despite
dominating, on an annual basis, CPO transactions declined 27%, while coffee and 250-gram gold each grew
2. Is the Future Price can be Predicted through Spot and Forward Price?
*Corresponding Author: www.aijbm.com 47 | Page
Posma Sariguna Johnson Kennedy1
64% and 27% respectively. But at the end of 2016, JFX was focused on efforts to increase multilateral
transactions of CPO derivative products. According to the official website www.jfx.co.id, the CPO price of the
October 2016 delivery contract at JFX for 10 tons of olein products (OLE) stagnated at the level of Rp. 10,730
per kg in line with the amount of 20 tons of OLE products which remained at Rp. 10,715 per kg. It's just that
since the end of 2015, the price of OLE20 tons has increased by 39.15% and OLE10tons has soared 35.39%.[2]
There are still many market participants who do not know that olein is the main ingredient in making
cooking oil, so that it loses compared to other JFX multilateral products such as gold and coffee. For
information, throughout 2015 the multilateral olein transaction volume was only 60,243 lots. From the data
provided by JFX, it is known that until September 20, 2015, OLE20 tons transactions have reached 51,000 tons
while OLE10 tons amounted to 26,000 tons or a total of 77,000 lots. This means that until the middle of
September 2016 olein transactions have reached 78% of the total target of JFX until the end of 2016.
Throughout 2017 the contract with the most significant increase was achieved from OLE10 products which
grew to 135%. Based on JFX data compiled by the business, OLE10 trading recorded the highest growth to
reach 107,000 lots, with an increase in transactions up to 135% from the previous year at 78,000 lots. However,
overall Olein products include OLE10 and OLE20 tons, which experienced a 16% increase in transactions
during 2017, with a growth of 3% year on year.[2]
Based on these data, the author will use olein commodity prices as the object of research. This study
aims to analyze futures price predictions by using forward rate and spot price variables, with case studies of
olein price movements at the Jakarta Futures Exchange in the 2015-2017 period. Thus the formulation of the
problem posed is how the relationship of spot prices and forward prices affects the forecast of futures prices on
olein commodities for the period 2015-2017.
II. LITERATURE REVIEW
Same in analyzing stock prices, in price analysis on commodity futures exchanges investors also need
to examine supply-demand in the market. In looking at changes in stock prices, investors see all variables, such
as macroeconomic factors, company progress, corporate financial health, company performance, organizational
systems within the company, facilities owned, continuity of good contracts with suppliers or third parties,
mastery of technology and information in this era of globalization, as well as other factors.[3]
In commodity markets, the market moves more dynamically, because the prices that occur will always
change reflected by the very active supply-demand process. Success in hedging (risk minimization) in the
futures market depends on the ability to anticipate and analyze the base of the relationship of future pricea and
spot price, identification and understanding of the mechanisms that affect the link, will help market players in
deciding marketing and production strategies.[4]
Futures prices are prices that occur on futures exchanges at certain times with later deliveries. Prices
are formed from the expectations of the actors based on predictions of commodity demand and supply. Futures
prices are the price of a futures contract, which is a futures contract that is binding on both parties to buy or sell
a particular financial or non-financial asset, the delivery of which is carried out in the future at a fixed price.[5]
Futures contracts are agreements to sell and buy assets at a certain period in the future at a fixed price
that has been agreed before. The amount of the futures contract is the opposite of the price in the spot market;
the rate will be lower or can be higher. Futures contracts are often used in hopes of eliminating risk (hedging)
[6]. Hull[7] describes a futures contract as an agreement between two parties to buy or sell assets in a certain
period in the future at a price agreed upon previously. Prices on futures contracts are influenced by supply and
demand as well as spot market prices. The rate of a futures contract can be higher or lower. In futures contracts,
some initial margins are required, which is the nominal amount of money that the investor needs to deposit to
the broker.
By using a futures contract, it is expected that risk prevention can be carried out against unwanted price
movements on the spot market. If the futures market and spot market move together, any losses suffered by
hedgers in one position can be offset by profit in the other place. Therefore gains and losses are expected to have
the same value. Futures contracts are forwarded institutionalized arrangements. Futures contracts for foreign
exchange are almost the same as futures contracts for various agricultural commodities (rubber, cacao, etc.), for
interest-bearing deposits and gold.[8]
According to Hull[9], spot prices are the current shipping prices for products traded on the spot market
or also called cash prices. Spot prices are prices that occur in the physical demand for commodities that are
directly bought at certain times and places. This price happens on an agreement with the seller and the buyer,
including the surrender requirements or the standard of the commodity being traded. Spot prices are influenced
by demand and supply. Hanafi[10] states that the spot contracts on money markets are foreign exchange
transactions with immediate delivery (theoretically even though in practice spot transactions are completed
within two or three days).
3. Is the Future Price can be Predicted through Spot and Forward Price?
*Corresponding Author: www.aijbm.com 48 | Page
Posma Sariguna Johnson Kennedy1
Forward prices are prices agreed upon in an asset transaction on a Forward contract. Forward contracts
are bilateral contracts that do not require a cash payment up to the time of delivery of assets or commodities at
the expired date exchanged for cash. The performance promised by the Forward contract is expected to not have
a significant risk due to guarantee and trust in the current parties. Prices of forwarding contracts with different
delivery times may have unequal costs.[9]
A forward contract is an agreement to sell or buy assets at a particular time in the future. Kimbal[11],
states a forward agreement or forward contract is an agreement between the two parties to sell and buy a
commodity that will be sent at a particular time in the future at an agreed price at this time. According to
Hull[7], forward contracts are agreements between two parties, namely sellers and buyers who negotiate and
decide on a written agreement of ability between the two parties to buy and sell certain assets, with the agreed
time. Ayuet.all[12] explained that forward contracts are agreements to sell or buy assets at certain times in the
future. The accepted value is not written in the deal because the cost will always change following the existing
fundamental conditions, such as supply-demand and occur during the contract.
Forward transactions are commodity transactions where delivery is carried out on a specific date in the
future. Forward transactions will be settled as determined when both parties agree to the contract to buy and sell
[8]. According to Hanafi[10], forward transactions in foreign currencies are transactions with surrenders over
some future currencies based on some other specific currencies. The rate in the forward deal is determined in
advance while the delivery and payment are made in the future. Forward prices are usually quoted with terms of
one, two, three, six and twelve months. But if another period is needed, (e.g., four months or even 55 days)
negotiations can be done.
The relationship of Spot Prices to Futures Prices can be explained through the contango and
backwardation theories. Contango is a market situation when Futures Prices are above the Spot Price. The
theory explains that commodity supply for the future time is expected to decline, while fixed or increasing
demand will push Futures Prices higher than Spot Prices. Instead, backwardation according to is a market
situation when Futures Prices are below the Spot Price. Backwardation theory explains if the inventory is
estimated to be excessive while the demand is fixed, it will encourage Futures Prices to be below the Spot Price.
In the process of forming prices towards equilibrium prices, namely prices at maturity, Spot Prices will go to
Futures Prices, which are called convergence points. Based on the explanation of the two theories, it can be
concluded that the Spot Price has a positive effect on Futures Prices.[13]
Forward contract agents generally also have better information about future price predictions because
the players in the forward market or negotiation market are parties that have a direct interest in the supplier of
the commodit. Suppliers in commodity markets have an essential role in means of price formation because
suppliers are more aware of the conditions of supply and demand in real terms on the market based on existing
inventories accurately so that the prices formed can represent actual supply and demand conditions. Information
possessed by forwarding contract players is more accurate in real time while futures contract players usually
only respond to news that has been officially announced, this makes the price predictions of forwarding contract
players faster and more accurate than futures market participants. Futures market participants will use Forward
Prices as a reference for Futures Prices. Thus it can be concluded that Forward Prices have a positive effect on
the predictions of Futures Prices.[8]
Previous research conducted by Yanthi&Artini[14] proved that the Spot Rate and Forward Exchange
Rate significantly proved to have a positive effect in predicting Spot Futures. While Prihatini[15] in his study
included macro variables in determining the impact of prices and other variables, namely production, exchange
rates, interest rates and world oil prices on exports were analyzed using VECM analysis. The results show that
in the long run futures priceshave a significant effect on exports.
Based on the background and exposure above, the hypotheses in this study are constructed: (1) Spot
prices influence predictions of futures prices, and (2) Forward prices have a positive influence on predictions of
futures prices.
III. METHODOLOGY
This study aims to predict futures prices as the dependent variable, using the variable forward price and
spot price as independent variables. The research method is quantitative with data analysis using a time series
approach using multiple regression methods. The object of the research used is olein commodity prices at the
Jakarta Futures Exchanges (JFX) with the period 2015-2017.
In this study, the method is carried out by observing, and recording the published commodity price
data. The type of data used is secondary data, namely data obtained from other parties or primary data that has
been processed by other parties. The data is obtained from JFX which is registered at BAPPEBTI. Olein price
data is obtained from www.bappebti.co.id[16] and www.jfx.co.id[2]. Spot olein price data is secondary data
issued by BAPPEBTI. Spot prices follow current market prices that occur in the physical market. The forward
4. Is the Future Price can be Predicted through Spot and Forward Price?
*Corresponding Author: www.aijbm.com 49 | Page
Posma Sariguna Johnson Kennedy1
price refers to the price of the forward olein contract but the price announced is the price that occurs between the
seller and the buyer through the broker through an average calculation.
The data analysis technique is carried out by doing descriptive statistics, standard assumption tests,
hypothesis testing, and multiple linear regression analysis. Descriptive statistics in question are to describe data
processed by the researcher about the mean, maximum and minimum values. The classic assumption test is done
to see whether in the data to be formed into a regression model there is residual normality, multicollinearity,
autocorrelation, and heteroscedasticity. Hypothesis testing is done by the F test t-test. The t-test, also called the
regression coefficient test partially aims to determine whether the independent variables can somewhat influence
significantly or not on the dependent variable. While the F test is conducted to test the significance of the
influence of several independent variables simultaneously on the dependent variable. Multiple linear regression
analysis aims to know the importance of independent variables and dependent variables.[17]
IV. FINDINGS
The data used is in the form of historical prices of monthly transactions for olein commodities, which
occur during 2015-2017, consisting of futures prices, spot prices, and forward prices. Based on data collection,
there are 36 data units that are ready to be processed and analyzed, the graph can be seen in the figure below.
Table 1. Data Graph and Descriptive Statistics
Movement of Futures Prices, Forward Prices and Spot Prices
Descriptive Statistics
N Minimum Maximum Mean Std. Deviation
Spot (X1) 36 7750.00 10908.00 9284.7867 781.24188
Forward (X2) 36 525.00 737.50 641.5694 50.26461
Futures (Y) 36 7730.00 10855.00 9365.4167 779.11706
Valid N (listwise) 36
Source: www.bappeti.co.id
The picture above shows futures price movements, spot prices and forward prices monthly,for the
period 2015 to 2017. From all the data of 36 spot olein market prices for the period of 2015 to 2017, we have a
minimum value of 7750 and a maximum value of 10908 with an average value of 9284.79 and a standard
deviation of 781.24. The lowest spot olein market price is found on the trade of 30-11-2015, while the highest
spot olein market price is located in trading on 31-01-2017.
We do a classic test on the datas, and the results are as follows:
a) Regarding thenormality test, the significance value (Sig.) of the spot price is 0.200, the value of Sig.
forward price of 0.200, and Sig. futures price of 0.200. Because of the significance value is greater than
the significance level (0.05), the three variables come from normal form.
b) Regarding the multicollinearity test, the Tolerance and VIF values of the spot price variable are 0.309
and 3.239, and the Tolerance and VIF values of the forward price variable are 0.309 and 3.239.
Because both independent variables have Tolerance values greater than 0.1 and VIF values smaller
than 10, it can be concluded that there are no symptoms of multicollinearity between independent
variables.
5. Is the Future Price can be Predicted through Spot and Forward Price?
*Corresponding Author: www.aijbm.com 50 | Page
Posma Sariguna Johnson Kennedy1
c) Regarding the heteroscedasticity test, from testing through graphic images, there is no clear pattern in
the picture, and the points spread above and below the number 0 on the Y axis, so there is
heteroscedasticity.
d) Regarding the autocorrelation test, the Durbin Watson value (d) is 1,331. Whereas based on the DW
table in appendix 5 for many independent variables (k) = 2 and the number of observations (n) = 36,
obtained the value of dL (outer limit) of 1.3537 and dU (inner border) of 1.5872, so determined a 4-dL
value of 2.6463 and 4-dU of 2.4128. From these calculations, it is known that the amount of Durbin
Watson (d) is located in the test area d (1.331) <dU (1.5872), which means there are symptoms of
autocorrelation.
The statistical analysis used in this study is multiple linear regression to determine whether there are
effect of the independent variables (spot price and forward price) on the dependent variable (futures price).The
results of statistical processing are as follows:
Table 2. Summary of Statistic Results
Coefficientsa
Model Unstandardized
Coefficients
Standardized
Coefficients
t Sig.
B Std. Error Beta
1 (Constant) 809.903 637.779 1.270 .213
Spot (X1) .958 .113 .960 8.476 .000
Forward (X2) -.523 1.756 -.034 -.298 .768
ANOVA
Model Sum of
Squares
Df Mean Square F Sig.
1 Regression 18468023.430 2 9234011.713 109.699 .000b
Residual 2777795.323 33 84175.616
Total 21245818.750 35
a. Dependent Variable: Futures (Y)
b. Predictors: (Constant), Forward (X2), Spot (X1)
Model Summaryb
Model R R Square Adjusted R
Square
Std. Error of
the Estimate
Durbin-Watson
1 .932a
.869 .861 290.13034 1.331
a. Predictors: (Constant), Forward (X2), Spot (X1)
b. Dependent Variable: Futures (Y)
Source: Data processed with SPSS 24.0
From the table above can be seen the results of hypothesis testing, are:
a) Effect of spot prices on futures prices. From the table, it is shown that the value of t count is 8.476 with
significant value (Sig.) of 0,000. Because the significant value (0,000) is smaller than the significant level
(0.05), it means that Ho is rejected and Ha is accepted, meaning that spot prices have a significant effect on
futures prices.
b) Effect of forwarding prices on futures prices. From the table, it is shown that the value of t count is -0.298
with a significant amount (Sig.) of 0.768. Because of the substantial cost (0.768) is higher than the
significant level (0.05), it means accepted, saying that the forward price does not have a significant effect on
futures prices.
c) The table above shows that spot prices and forward prices have a significant effect on futures prices
simultaneously.
d) The table above shows the coefficient of determination (R square) of 0.869. This means that 86.9% of
futures prices are influenced by the two independent variables of forward rates and spot prices, while the
remaining 13.1% are influenced by other causes.
6. Is the Future Price can be Predicted through Spot and Forward Price?
*Corresponding Author: www.aijbm.com 51 | Page
Posma Sariguna Johnson Kennedy1
V. CONCLUSION
Partially, spot prices have a positive and significant effect on futures prices for olein commodities, and
the forward rate has no impact on futures prices for olein commodities. Simultaneously, spot prices and forward
prices have a significant effect on futures prices for olein commodities traded on the Jakarta Futures Exchange.
Also, the coefficient of determination (R square) is obtained amounting to 0.869, which means that 86.9% of
futures prices are influenced by both the independent spot price and forward prices, while the remaining 13.1%
are influenced by other factors.
Empirically, it is evident that spot prices are the best predictors in predicting futures prices. In doing
hedging, the calculation must be done carefully. By knowing the relationship of spot prices and forward prices
to futures prices, it is expected to be used as an estimate for users to obtain market price information. Also, it
can be used as supporting data in the fundamental analysis in determining when it is in the position of selling or
buying, especially for olein commodities.For further research, it is recommended to add other variables by
increasing the data variant and the study period.
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[17] Sugiyono, MetodologiPenelitian (Bandung, Alfabet, 2011, 34–60).
*Corresponding Author: Posma Sariguna Johnson Kennedy
1
Faculty of Economics and Business, Universitas Kristen Indonesia, Jakarta, Indonesia