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FUTURES TRADING IN MAIZE – AN ECONOMETRIC ANALYSIS

KrishiKosh

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Title FUTURES TRADING IN MAIZE – AN ECONOMETRIC ANALYSIS
 
Creator RAJESH CHAITHANYA, K
 
Contributor ESWARA PRASAD, Y
 
Subject FUTURES, TRADING, MAIZE, ECONOMETRIC, ANALYSIS
 
Description Commodities futures trading have become an integral part in the lives of mankind,
since the dawn of civilization. Over the years, commodities markets have been
experiencing tremendous progress, which is evident from the fact that the futures
trading in commodities is considered as an important element of the global
economy today. The promising nature of these emerging markets has made them
an attractive investment avenue for investors.
In India, commodity futures trading has experienced a turbulent voyage despite a
long history of commodity markets. This is because of stringent regulatory
restrictions and policy interventions by the government. Frequent ban on
commodity trading deteriorated this further. Commodity futures markets have a
huge potential in the Indian context particularly because of the agri-based economy.
The present method of marketing cannot be changed in short period, but can be
modified by introducing new methods without disturbing the basic structure.
Therefore, for sustainable development of the markets in India, futures trading in
agricultural commodities was implemented by the government with a complete
change in its policies which resulted in unprecedented boom in terms of number of
modern exchanges, number of commodities traded and value of futures trading in
commodities from the year 2002.
Maize, third important crop in India after Rice and Wheat has transformed it self
from food crop to commercial crop due to its growing importance in agro-based
industries. The age-old relationship between maize and futures trading and their
growing importance in Indian economy has driven my thoughts to study futures
trading in maize with the following objectives:
1. To study the price discovery in Maize.
2. To forecast the prices in Maize.
3. To analyse the functioning of futures market in Maize.
Nizamabad, Karimnagar and Warangal maize markets in Andhra Pradesh were
purposively selected for the study as they were considered to be the best
performing markets. Secondary data pertaining to arrivals and prices from the
above markets was collected for the analysis of the objectives. Statistical tools like
correlation, regression and ARIMA were used in order to fulfill the stated objectives
in the present study.
The results of price discovery using correlation of prices among different markets
under study revealed that Nizamabad and Warangal markets have positive
correlation to the tune of 0.617(arrivals) and 0.638(prices). Nizamabad and
Karimnagar markets show a correlation coefficient of 0.809(arrivals) and
0.605(prices), indicating that prices and arrivals of these districts were positively
correlated. Warangal and Karimnagar markets have positive correlation with
correlation coefficient values of 0.551(arrivals) and 0.685 (prices).
In Price forecasting, monthly averages of prices were fit in to ARIMA to get the
forecasted prices .The results revealed rise in prices of maize for the markets under
study, during the months of October 2007 and March 2008.
In studying the functioning of maize futures market, price discovery proved the
efficient functioning of maize futures at a constant pace in the selected markets.
 
Date 2016-08-05T14:44:24Z
2016-08-05T14:44:24Z
2007
 
Type Thesis
 
Identifier http://krishikosh.egranth.ac.in/handle/1/71091
 
Language en
 
Relation D8121;
 
Format application/pdf
 
Publisher ACHARYA N.G. RANGA AGRICULTURAL UNIVERSITY, RAJENDRANAGAR, HYDERABAD