scholarly journals A Derivative is a Risk Hedging Tool from Investor Perspective

2020 ◽  
Vol 8 (3) ◽  
pp. 39-44
Author(s):  
S Manjushree
Keyword(s):  
Price Level ◽  
Supply And Demand ◽  
Capital Allocation ◽  
Economic Benefits ◽  
Financial Derivatives ◽  
Risk Averse ◽  
Risk Hedging ◽  
Commodity Derivatives ◽  
The Stability ◽  
Derivative Products

Derivatives products provide certain important economic benefits such as risk management or redistribution of risk away from risk-averse investors towards those more willing and able to bear the risk. Derivatives also help price discovery, i.e., the process of determining the price level for any asset based on supply and demand. These functions of derivatives help inefficient capital allocation in the economy; at the same time, their misuse also poses a threat to the stability of the financial sector and the overall economy. In the mid-1990s, India started reviving the exchangetraded commodity derivatives market. It introduced a variety of instruments in the foreign exchange derivatives market, while exchange-traded financial derivatives were introduced in 2001. Given India’s experience in informal derivatives trading, the exchange-traded derivatives were quick to pick up substantial volumes. This paper presents the concept of derivative and types of derivative products and how the investor perceives the derivative instrument as a risk-hedging tool in shivamooga city. The study is selected 70 respondents and used percentage analysis. The result obtained from the study reveals that the investor prefers a derivative is a risk-hedging tool.

Consumer Behavior Changes Post Pandemic Covid-19

2020 ◽  
Vol 2 (2) ◽  
pp. 84-89
Author(s):  
Tati Maryati
Keyword(s):  
Consumer Behavior ◽  
Eating Habits ◽  
Supply And Demand ◽  
Health Economy ◽  
Behavior Changes ◽  
The World ◽  
The Stability ◽  
The Many ◽  
New Consumer ◽  
At Home

The Corona virus or Covid-19 which is unexpected will come to us, has an impact on health, economy and also humanity throughout the world and is able to fundamentally change the world. Supplements are disrupted because production is stopped, retail stores close, causing consumers to change their behavior, which had previously gone offline shopping. Not just shopping, when a pandemic, the way of thinking becomes different. Consumers around the world are looking for products and brands through new ways and new habits are formed. Online transactions focus more on basic products to make ends meet. The fact that Covid-19's anti-virus has not been found raises concerns about disrupted health and the Government's regulation to work and stay at home also raises concerns about disrupted businesses. Differences from habits and interests or preferences that are different for each person, provide different responses to the problems faced and solutions for the future. The habit of shopping offline has a tendency to continue for complementary products while food products are more directed towards offline. The rest eating habits at home can be continued because it provides more hygiene guarantees. The new habit of holding online meetings with distant relatives or colleagues will be increasingly considered given the many more positive things that can be obtained. Likewise with work problems, working from home is more interesting to consider because it is more efficient and effective and the results can be more productive. This new consumer behavior is adjusted to provide satisfaction for many parties, with the assistance of institutions or governments that oversee the security of supply and demand and maintain the stability of both. 

Growth prospects, market challenges and policy measures: evolution of mobile broadband in Pakistan

2018 ◽  
Vol 20 (1) ◽  
pp. 42-61 ◽  
Author(s):  
Muhammad Shehzad Hanif ◽  
Shao Yunfei ◽  
Muhammad Imran Hanif
Keyword(s):  
Developing Country ◽  
Service Providers ◽  
Supply And Demand ◽  
Economic Benefits ◽  
Content Type ◽  
Mobile Broadband ◽  
Broadband Service ◽  
Policy Measures ◽  
The Government

Purpose The paper aims to explore the long-term prospects of mobile broadband adoption in a developing country. The supply-side and demand-side policy measures are recommended to counter the challenges to broadband adoption. Design/methodology/approach Methodologically, this study uses document analysis to explain secondary data including growth statistics, trade literature and previous scholarly research. Based on the growth statistics of broadband and the informed market insights, the research discusses the prevailing market threats and recommends counter measures to improve the long-term prospects of broadband propagation. Findings The growth of mobile broadband is settling down in Pakistan due to various barriers like cost, literacy, security and unavailability of local content. Collaborative efforts are required by the government, the service providers and the people to enhance the adoption of broadband service and secure economic benefits of the broadband. Practical implications The research offers useful implications for managers and policymakers in Asian and African developing countries; the policy measures discussed here may serve as guidelines for them in the design of their own policies regarding broadband supply and demand. Originality/value The study makes an effort to examine the broadband growth in a developing country on the basis of both quantitative and qualitative aspects. The research endeavors to fill the gap on the particular scholarship of research covering potential uptake of broadband services and the effects of constraining elements to broadband adoption in a developing country.

scholarly journals INDONESIAN COCONUT COMPETITIVENESS IN INTERNATIONAL MARKETS

2019 ◽  
Vol 1 (3) ◽  
pp. 46-50
Author(s):  
Heriyanto Heriyanto
Keyword(s):  
Comparative Advantage ◽  
Supply And Demand ◽  
International Market ◽  
World Market ◽  
International Markets ◽  
Average Value ◽  
A Value ◽  
Constant Market Share Analysis ◽  
Constant Market Share ◽  
Derivative Products

Indonesia is one of the country's largest Coconut producer and exporter in the world market. The management efforts of Indonesia coconut not optimal, coconut export is still largely in the form of primary products, a type of derivative products coconut produced Indonesia is still limited. But in general, this research aims to analyze the Export Competitiveness of coconut Indonesia in international markets, specifically aims to analyze the position and competitiveness of Indonesia coconut commodities in the international market. Methods of data analysis using Trade Specialization Index (TSI), the analysis Revealed Comparative Advantage (RCA), and the Constant Market Share analysis (CMS). The results showed that during the period of 2005-2016, the development of supply and demand are relatively unstable and likely to rise. TSI values during the period of 2005-2016 have the value positive that shows that Indonesia is a country exporting coconut and belongs into the categories of very mature in the international market, indicated by the average value of the TSI of 1.00. The value of the RCA during the period of 2005-2016 have a value above 1 indicating that Indonesia Coconut has a comparative advantage for the commodity. While the analysis results in CMS during the period of 2005-2016 based on the four effects shows that the competitiveness of coconut Indonesia influenced by standard growth effects and efficient distribution where the coconut export growth in Indonesia is affected by the growth of coconut import world.  

The Israeli travel and tourism industry faces COVID-19: developing guidelines for facilitating and maintaining a nuanced response and recovery to the pandemic

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Joshua Schmidt ◽  
Alex Altshuler
Keyword(s):  
Cultural Context ◽  
Service Providers ◽  
Risk Mitigation ◽  
Supply And Demand ◽  
Economic Benefits ◽  
Tourism Industry ◽  
Research Approach ◽  
Content Type ◽  
Travel And Tourism ◽  
The Government

Purpose This paper aims to discuss how the tourism industry is contending with the economic and interorganizational challenges wrought by the COVID-19 outbreak and heightened by a lack of communication between the government and local businesses in the state of Israel. The researchers examine the dependency of the tourism industry on the general preparation programs that were developed and are currently being deployed by the relevant national stakeholders and question whether instead, it should use the pandemic as a catalyst for formulating its own nuanced tourism-travel-and-hospitality-oriented strategies and procedures. Design/methodology/approach Applying an ethnographic-based mix-methods research approach, this paper draws on insights from data compiled by fusing existing theoretical and emerging practical knowledge with empirical research (qualitative and quantitative) conducted among numerous relevant macro (governmental/centralized industry) and micro (hotels, travel and tourism operators and service providers) stakeholders as well as potential consumers. Findings It is essential that national and local government bodies form collaborative interorganizational relationships with local stakeholders to jointly activate case-specific hospitality and travel-specific risk mitigation management strategies. Moreover, the pandemic laid bare the tentative and fragile nature of the globalized tourism industry supply and demand chains, a condition that may be remedied via a pivot toward using national or even regional supply chains and goods and service providers. Within Israel, such changes could lead to increased economic benefits that extend beyond the tourism industry to provide certain security-related benefits. Originality/value Relating to idiosyncratic factors relevant to an Israeli cultural context, this paper uses the ethnographic field-borne familiarity of the researchers with the tourism and travel industries in Eilat and the Dead Sea to offer applicable suggestions for leveraging certain industry resources to both meet the demands of the present-day circumstances and cultivate a multifaceted organizational web of macro and micro social, economic and environmental networks so as to foster a more diversified and therefore resilient local tourism and travel economy.

Combined Custom Hedging: Optimal Design, Noninsurable Exposure, and Operational Risk Management

2021 ◽  
Author(s):  
Paolo Guiotto ◽  
Andrea Roncoroni
Keyword(s):  
Risk Management ◽  
Optimal Design ◽  
Operations Management ◽  
Operational Risk ◽  
Financial Derivatives ◽  
Theoretical Ground ◽  
Risk Averse ◽  
Value Assessment ◽  
Operational Risk Management ◽  
Payoff Functions

Optimal Design of Combined Contingent Claims: Theory and Applications. In “Combined Custom Hedging: Optimal Design, Noninsurable Exposure, and Operational Risk Management”, Paolo Guiotto and Andrea Roncoroni develop a normative framework for the optimal design, value assessment, and operations management integration of financial derivatives. Most business and operating revenues entail a mix of financially insurable and noninsurable risk. A risk-averse firm may face them by positioning in a pair of financial derivatives with optimal bespoke payoff functions; one claim is written on the insurable term, and the other claim is written on any observable index exhibiting correlation to the noninsurable term. On a theoretical ground, the authors 1) state the problem in a general setup and prove existence and uniqueness of the optimal pair of combined claims, 2) show that the optimal payoff functions satisfy a Fredholm integral equation, and 3) assess the incremental benefit the firm obtains by switching from the optimal single-claim custom hedge to the optimal combined custom hedge they propose. On an experimental ground, they show that 1) the optimal combined custom hedge would be empirically relevant for a highly risk-averse firm facing a market shock shown during the first period of the COVID-19 pandemic in 2020, 2) integration with the optimal procurement in a generalized newsvendor model leads to a significant improvement in both risk and return, and: 3) this gain can be traded off for a substantial enhancement in operational flexibility.

Evaluating the Efficiency of Portfolio-Hedging Strategies by Incorporating Third Degree Stochastic Dominance Criteria and Data Envelopment Analysis

2021 ◽  
pp. 22-46
Author(s):  
Margareta Gardijan Kedžo
Keyword(s):  
Data Envelopment Analysis ◽  
Stochastic Dominance ◽  
Data Envelopment ◽  
Risk Averse ◽  
Super Efficiency ◽  
Risk Hedging ◽  
The Third ◽  
Positive Skewness ◽  
Hedging Strategies ◽  
Efficient Hedging

The chapter investigates chosen hedging strategies with options as useful risk hedging instruments. Assuming that average investor prefers greater return, is risk-averse, and prefers greater positive skewness, the performance of different hedged and unhedged portfolios is evaluated using stochastic dominance (SD) criteria and data envelopment analysis (DEA). The SD is examined up to the third degree (TSD) using Davidson-Duclos (DD) test. In the DEA, a super efficiency BCC model is used. It is investigated how these two methodologies can be combined and how the TSD criteria can be integrated into DEA in order to simplify the analysis of determining efficient hedging strategies with options.

scholarly journals Do natural rubber price bubbles occur?

2019 ◽  
Vol 65 (No. 2) ◽  
pp. 67-73 ◽  
Author(s):  
Chi-Wei Su ◽  
Lu Liu ◽  
Ran Tao ◽  
Oana-Ramona Lobonţ
Keyword(s):  
Time Series ◽  
Natural Rubber ◽  
Supply And Demand ◽  
Oil Prices ◽  
Climatic Changes ◽  
Price Bubbles ◽  
Augmented Dickey Fuller ◽  
Multiple Bubbles ◽  
Market Fundamentals ◽  
The Stability

In this paper, we employ the Generalized Supremum Augmented Dickey-Fuller test in order to identify the existence of multiple bubbles in natural rubber. This approach is practical for the using of time series and identifies the beginning and end points of multiple bubbles. The results reveal that there are five bubbles, where exist the divergences between natural rubber prices and their basic values on account of market fundamentals. The five bubbles are related to imbalance between supply and demand, inefficiencies of smallholders market, oil prices, exchange rate and climatic changes through analyses. Thus, the corresponding authorities are supposed to identify bubbles and consider their evolutions, which is beneficial to the stability of natural rubber price.

scholarly journals Dynamic Analysis of Duopoly Price Game Based on Low-Carbon Technology Sharing

2020 ◽  
Vol 2020 ◽  
pp. 1-18
Author(s):  
Fengshan Si ◽  
Zhengkun Yan ◽  
Jing Wang ◽  
Daoming Dai
Keyword(s):  
Research And Development ◽  
Supply And Demand ◽  
Equilibrium Strategy ◽  
Low Carbon ◽  
Technology Research ◽  
Product Price ◽  
Price Game ◽  
Game Equilibrium ◽  
The Stability ◽  
Technology Level

Taking the carbon emissions per unit product as the standard to measure the low-carbon technology level of the enterprise, this article analyzed how the technology supplier enterprises realize low-carbon production and achieve a win-win situation for both supply and demand through technology sharing through technology research and development. Based on the positive effect of low-carbon technology level on product demand, we studied the optimal pricing strategy and the optimal low-carbon technology level in the technology supply enterprises under the Stackelberg game in 3 conditions (i.e., without technology research and development or technology sharing, with technology research and development but no technology sharing, and with both technology research and development and technology sharing). We also drew a comparative analysis of the optimal product price, the optimal low-carbon technology level, and the optimal profit in the three scenarios. Besides, by constructing a delayed differential price game model, we studied the equilibrium strategy of price competition between technology supply and demand companies and the local asymptotic stability of the game system at the equilibrium point. In addition, the effects of delay strategy on game equilibrium strategy, the influence of the degree of adjustment of decision variables on the stability of the game system, and the stability of the game system on the evolution trend of the game are also explored. By comparing and analyzing the game results of the oligopoly enterprises in the stable system and the unstable system, it confirmed that the system instability usually causes serious harm to the enterprise.

scholarly journals A Multiobjective Robust Scheduling Optimization Mode for Multienergy Hybrid System Integrated by Wind Power, Solar Photovoltaic Power, and Pumped Storage Power

2017 ◽  
Vol 2017 ◽  
pp. 1-15 ◽  
Author(s):  
Lihui Zhang ◽  
He Xin ◽  
Jing Wu ◽  
Liwei Ju ◽  
Zhongfu Tan
Keyword(s):  
Wind Power ◽  
Hybrid System ◽  
Supply And Demand ◽  
Stochastic Theory ◽  
Stochastic Scheduling ◽  
Economic Benefits ◽  
Load Curve ◽  
Scheduling Optimization ◽  
Pumped Storage ◽  
Photovoltaic Generators

Wind power plant (WPP), photovoltaic generators (PV), cell-gas turbine (CGT), and pumped storage power station (PHSP) are integrated into multienergy hybrid system (MEHS). Firstly, this paper presents MEHS structure and constructs a scheduling model with the objective functions of maximum economic benefit and minimum power output fluctuation. Secondly, in order to relieve the uncertainty influence of WPP and PV on system, robust stochastic theory is introduced to describe uncertainty and propose a multiobjective stochastic scheduling optimization mode by transforming constraint conditions with uncertain variables. Finally, a 9.6 MW WPP, a 6.5 MW PV, three CGT units, and an upper reservoir with 10 MW·h equivalent capacity are chosen as simulation system. The results show MEHS system can achieve the best operation result by using the multienergy hybrid generation characteristic. PHSP could shave peak and fill valley of load curve by optimizing pumping storage and inflowing generating behaviors based on the load supply and demand status and the available power of WPP and PV. Robust coefficients can relieve the uncertainty of WPP and PV and provide flexible scheduling decision tools for decision-makers with different risk attitudes by setting different robust coefficients, which could maximize economic benefits and minimize operation risks at the same time.

Determinants of corporate foreign exchange risk hedging

2014 ◽  
Vol 40 (2) ◽  
pp. 176-188 ◽  
Author(s):  
Lee-Lee Chong ◽  
Xiao-Jun Chang ◽  
Siow-Hooi Tan
Keyword(s):  
Exchange Rate ◽  
Descriptive Analysis ◽  
Financial Derivatives ◽  
Content Type ◽  
Risk Hedging ◽  
Financial Firms ◽  
Hedging Strategies ◽  
Factors Influencing ◽  
Financial Hedging ◽  
Exchange Risk

Purpose – The purpose of this study is to delineate the factors influencing the use of financial derivatives by non-financial firms in managing their exchange rate exposure. In total, 219 non-financial firms are surveyed in regard to their financial hedging decision. Design/methodology/approach – This study is conducted via a survey and the questionnaires were sent to the treasurers and financial controller of the firms. Descriptive analysis is employed to assess the profiles of the respondents. Then, factor analysis is carried out to determine the factors influencing the use of financial derivatives in Malaysia. Findings – The results indicate that the hedging decision of non-financial firms is influenced by their assertive level toward the market and regulators and also how flexible they are for derivative instruments. The intellectual capability that firms acquire to perform hedging strategies is also vital in influencing them to make hedging decision. Practical implications – The insights of this survey would assist and prepare firms to hedge their exchange rate risk by employing financial derivatives. Knowing the influences of firms' adoption of currency derivatives would allow policy makers to formulate their policies in boosting the liquidity of Malaysian derivative market. Originality/value – This study presents findings on the factors influencing the execution of financial hedging by non-financial firms in Malaysia. Survey data are used to seek for the feedback from the market players in order to provide empirical evidence on the corporate use of financial hedging.

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