HEDGING CLASS I MILK: THE "ACCELERATION" AND "MOVER" EFFECT

Michael J. Zylstra, Richard L. Kilmer and Stanislav Uryasev

No 20109, 2004 Annual meeting, August 1-4, Denver, CO from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: A volatile closing basis prevents class I hedgers from locking in a minimum price. The closing basis is composed of an "acceleration" and "mover" effect. The mover effect always works to the producer's advantage unlike the acceleration effect. This research discusses hedging strategies to minimize the acceleration effect.

Keywords: Marketing (search for similar items in EconPapers)
Pages: 11
Date: 2004
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea04:20109

DOI: 10.22004/ag.econ.20109

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