Question
Q11. What wouldhavehappenedif you hedgedusing the nave hedge ratio( HRN ) and nave number of futures contract ( NFCN )?Using the following table, calculate the
Q11.What wouldhavehappenedif you hedgedusing the nave hedge ratio(HRN) and nave number of futures contract (NFCN)?Using the following table, calculate the revenue from selling the live animals in the local cash market, gain/loss from the futures position, total revenue, and net realized price per pound of live animal.Compare the results with the answersto the previousquestion.(10points)
Date/Action
Cash Market
Futures Market
Jan 02, 2020
Action
CP = 106.10 cents/lb.
FP = 114.20 cents/lb.
_______ _____Jun 2020CME LC contracts@________ cents/lb.
June 02, 2020
Action
CP = 110.90 cents/lb.
FP = 116.40 cents/lb.
________ 1,000 cattle (1,200,000 lb.) @ ________
_______ _____Jun 2020CME LC contracts@________ cents/lb.
Gain / Loss =
Return from Cash Market
=
Return from Futures Market
=
Net Return from Cash and Futures Markets
=
Net realized price of live cattle (cents/lb.)
=
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Research Design Qualitative Quantitative And Mixed Methods Approaches
Authors: John W. Creswell, J. David Creswell
5th Edition
1506386709, 9781506386706
