Does Financial Stress Affect Commodity Futures Traders' Positions?

Shengwu Du, Travis Nesmith and Yanggen Heppe

Journal of Futures Markets, 2026, vol. 46, issue 2, 413-434

Abstract: We examine trading behavior in commodity futures markets in the United States during the 2008 Global Financial Crisis (GFC) and the COVID‐19 pandemic, focusing on absolute changes and relative exposure dynamics. These crises led to distinctly different trading patterns. During the 2008 GFC, speculators rapidly closed long positions while producers facilitated these trades, shifting risk from speculators to producers. In contrast, during the COVID‐19 crisis—characterized by milder financial stress and an early commodity market rally—there was not meaningful risk transfer from speculators. The impact on traders' relative exposures was minimal in both crises. However, speculators generally showed greater sensitivity to changing financial conditions than hedgers throughout the study period. These findings highlight the varying impacts of financial stress on commodity futures markets and the importance of crisis‐specific context in understanding trader behavior.

Date: 2026
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1002/fut.70064

Related works:
Working Paper: Does Financial Stress Affect Commodity Futures Traders’ Positions? (2025)
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:wly:jfutmk:v:46:y:2026:i:2:p:413-434

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0270-7314

Access Statistics for this article

Journal of Futures Markets is currently edited by Robert I. Webb

More articles in Journal of Futures Markets from John Wiley & Sons, Ltd.
Bibliographic data for series maintained by Wiley Content Delivery ().