Regional Limitations on the Hedging Effectiveness of Natural Gas Futures

Emile J. Brinkmann and Ramon Rabinovitch

The Energy Journal, 1995, vol. 16, issue 3, 113-124

Abstract: This paper examines the extent to which limitations in the transportation system for the natural gas market in the United States narrows the effectiveness of the NYMEX natural gas future contract as a hedging instrument and why a second contract with a different delivery point was approved during 1995. We find that the NYMEX contract is an effective hedging instrument for gas sold into pipelines for consumption in southern, eastern and midwestern states, but does not provide an effective hedge for gas sold for Rocky Mountain and West Coast states.

Keywords: Natural gas futures; NYMEX; gas prices; hedging; market integration (search for similar items in EconPapers)
Date: 1995
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://journals.sagepub.com/doi/10.5547/ISSN0195-6574-EJ-Vol16-No3-5 (text/html)

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: https://EconPapers.repec.org/RePEc:sae:enejou:v:16:y:1995:i:3:p:113-124

DOI: 10.5547/ISSN0195-6574-EJ-Vol16-No3-5

Access Statistics for this article

More articles in The Energy Journal
Bibliographic data for series maintained by SAGE Publications ().