Economics at your fingertips  

Grain Price Expectations of Illinois Farmers and Grain Merchandisers

James S. Eales, Brian K. Engel, Robert J. Hauser and Sarahelen Thompson ()

American Journal of Agricultural Economics, 1990, vol. 72, issue 3, 701-708

Abstract: The study's purpose is to measure the extent to which futures and option prices reflect the subjective price distribution of a subset of market participants, farmers, and grain merchandisers in Illinois. Findings suggest that in most instances the futures price is an appropriate proxy for expected price. However, volatilities implied by option premia usually overestimate the subjective variances of producers and merchandisers. These differences between individual and market expectations of variance are consistent with findings of overconfidence in the psychology literature and should be considered by analysts when making observations about hedging decisions and risk aversion.

Date: 1990
References: Add references at CitEc
Citations: View citations in EconPapers (35) Track citations by RSS feed

Downloads: (external link) (application/pdf)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this article

American Journal of Agricultural Economics is currently edited by Madhu Khanna, Brian E. Roe, James Vercammen and JunJie Wu

More articles in American Journal of Agricultural Economics from Agricultural and Applied Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by Oxford University Press ().

Page updated 2023-03-26
Handle: RePEc:oup:ajagec:v:72:y:1990:i:3:p:701-708.