Question
a. Analyse the price of the Future Crude Palm Oil (FCPO) and conclude the trend of the market prices for the next six months. How
a. Analyse the price of the Future Crude Palm Oil (FCPO) and conclude the trend of the market prices for the next six months. How do you relate to what you observed in the prices and the function of derivatives? (6 marks)
b. If a Crude Palm Oil Producer sells CPO futures, is that hedging or speculating? Support your answers with the primary motives for a hedger and a speculator in the derivatives market. (6 marks)
c. Illustrate how a manufacturer who has an ongoing need for Crude Palm Oil as a raw material in the production process might use futures to hedge. What does the manufacturer hope to gain? (7 marks)
d. Discuss why speculators of Crude Palm Oil have the riskiest position as compared to spreaders and arbitrageurs? (6 marks)
urgent, help me please, thank you
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