Transcript AGEC 420 COMMODITY FUTURES MARKETING

AGEC 420
COMMODITY FUTURES MARKETING
• John (Sean) Fox
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Office
331J Waters, 2-4446
Hours
M,W,F 9:30-11:30, or by appointment
e-mail
[email protected]
Homepage www.agecon.ksu.edu/jafox/
• T.A.
• Christina Cundiff
[email protected]
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AGEC 420
• Prereqs:
Agec 120 or Econ 120
• Texts - recommended
– Agr. Futures and Options, Purcell/Koontz
– A Random Walk down Wall Street, Malkiel
• Other Books:
– Merchants Edge, Lorton/White
– CBOT and CME workbooks (on order)
– Hale Library, section HG 6046
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Grading
• Evaluation:
– Examinations
– Assignments
– Quizzes
300
120
80
• Grades:
– A 90% - 100%; B 80% - 89%; C 70% - 79%
– D 60% - 69%; F <60%
• Honor system:
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Course Outline
Section 1:
– Introduction to Futures:
– history, definitions, specifications, participants,
– How the Markets Work:
– margin, types of orders, guest speaker,
– Hedging:
– short and long hedges, basis and basis risk
• Readings: Purcell: Ch. 1,2. Malkiel: Ch 1,11
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Course Outline
Section 2:
– Hedging (cont.)
– storage hedge, basis contract
– Fundamental Analysis:
– supply and demand, information, regression,
– Technical Analysis:
– bar charts, moving averages
– Speculation and Market Efficiency:
• Readings: Purcell: Chs 3-5. Malkiel: Chs 5-8
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Course Outline
Section 3:
– Options on Futures:
– put and call options
– use in hedging, speculating
– Other Topics:
– Option pricing,
– Products based on Options,
– Cross hedging, Financial Futures
• Readings: Purcell: Ch 7. Malkiel: Ch 11
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Student Info
• Enter name, SSN in space provided:
1. Your Major:
A
B
C
D
E
if AgEcon or Agribusiness
if ASI
if Agronomy
if Other College of Ag
if not College of Ag
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Student Info
2. Your Class:
A
B
C
D
if Freshman
if Sophomore
if Junior
if Senior
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Student Info
3. Familiarity with futures markets:
A
B
never heard of them before this class
heard of them, but know little or nothing
about them
C know something about them, never traded
D know something about them, traded some
E know quite a bit, traded quite a bit
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Student Info
4. The main reason I chose this course:
A
Required class
B
Not required, advised to take it
C
Not required; fits schedule; heard it was OK
D
Interested in learning about futures
E
Learn how to make money in futures
Other (explain on back of sheet)
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Student Info
5. From a farming/ranching background?
A
B
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Yes
No
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Student Info
6. If your family farm grows wheat – approx how
much?
A < 500 acres
B 500 – 1000 acres
C 1000 – 1500 acres
D 1500 – 2000 acres
E > 2000 acres
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Student Info
7. Do you agree to having your grades posted
using the last 4 digits of your SSN?
A
B
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Yes
No
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Assignment #1
• e-mail to [email protected]
• Include a futures price quote
• e.g., KCBT July Wheat closed @ 2734 on Jan 20
• and the source of the information, e.g. DTN, CME Website
• cc to Christina Cundiff [email protected]
• Never used e-mail
Get userid / password at University Consulting Desk,
313 Hale Library; 2-7722, 8:30 - 4:30
• Due: Friday, Jan. 25 (5 points)
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Video
Partners: American Agriculture and the Kansas
City Board of Trade (KCBT)
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AGEC 420, Lec 1
Introduces market participants
Purpose of the futures market
Hedging – advantages
Speculation - liquidity
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