Managing economic risk in value‐based marketing of fed cattle
研究育肥牛生产者在网格定价中如何通过期货对冲最优管理价格风险，发现基价选择显著影响对冲策略，与下游市场关联更紧的基价虽能提升定价效率但风险更难管理。
Abstract This research investigates optimal price risk management strategies for fed cattle producers engaged in grid pricing. Stochastic simulation is used to determine optimal hedge ratios for fed cattle priced on a live weight basis or on a series of grids that vary in terms of premium/discount structure as well as base price. Results indicate that the optimal hedging strategy is greatly affected by the base price used in a particular grid. This has significant implications for pricing efficiency in the cattle market. Base prices that are linked more closely with downstream markets offer the potential to improve pricing efficiency; however, the risk associated with these prices is difficult to manage effectively with existing futures instruments.