The value of forecasts in optimal portfolio short hedging of fed cattle.

Bibliographic Details
Main Author: Gerlow, Mary
Other Authors: Bessler, David A. (degree committee member.), Goodwin, Harold L. (degree committee member.), Wiggins, Steven N. (degree committee member.)
Format: Thesis Book
Language:English
Published: 1987.
Subjects:
Online Access:Link to OAKTrust copy

MARC

Tag First Indicator Second Indicator Subfields
LEADER 00000ctm a2200000Ia 4500
001 in00000020601
005 20200904152406.0
008 880716s1987 xx a bm 000 0 eng d
035 |a (OCoLC)ocm18228272 
035 |9 AAB3527AM 
040 |a TXA  |b eng  |c TXA  |d OCLCQ  |d OCLCF  |d OCLCO  |d OCLCQ  |d OCLCA  |d TXA 
035 |a (OCoLC)18228272 
043 |a n-us-tx 
049 |a TXAM 
099 |a 1987  |a Dissertation  |a G371 
100 1 |a Gerlow, Mary. 
245 1 4 |a The value of forecasts in optimal portfolio short hedging of fed cattle. 
264 1 |c 1987. 
300 |a xvi, 260 leaves :  |b illustrations ;  |c 29 cm 
336 |a text  |b txt  |2 rdacontent 
337 |a unmediated  |b n  |2 rdamedia 
338 |a volume  |b nc  |2 rdacarrier 
500 |a Typescript (photocopy). 
502 |b Ph. D. in Agricultural Economics  |c Texas A & M University  |d 1987 
500 |a Vita. 
504 |a Includes bibliographical references (leaves 237-244). 
520 3 |a A major problem for Texas cattle feeders is price uncertainty in the output market. This research evaluates the performance of selected private price forecasts in management of price uncertainty. Three information environments are examined. Within each environment four strategies may be used either individually or in combination: cash sales, short futures, long put options, and short call options. Each forecasting model was estimated using monthly data from the period 1978-1983 and evaluated as to its forecasting ability over an out-of-sample period 1984-1985. These forecasts were either a direct estimation of Amarillo cash prices or involved modeling the local Amarillo closing basis and estimating cash prices indirectly. Of these, a restricted vector autoregressive model was chosen to generate direct cash price forecasts for the Amarillo market. A quadratic programming model derived optimal combinations of the available hedging instruments and cash sales which maximized total net returns to the cattle feeder subject to an acceptable level of variability upon those returns. The difference between the returns resulting from the various information environments were obtained and analyzed. Return streams were analyzed using stochastic dominance criteria. The difference itself was an ex post measure of price forecast information value and it represents ability of cattle feeders to pay for private price forecast information. In all cases the value was positive and significantly different from zero. However, it did not prove sensitive to the risk aversion parameter chosen. The results indicate that, for the out-of-sample period, the mean net return from cash sales alone was $0.02 per cwt with a coefficient of variation of 1.13. The use of past performance information to generate an optimal portfolio led to both an increased mean net return of $0.57 per cwt with an increased coefficient of variation of 6.51. However, by utilizing both forecast information and past performance information, the mean net return rose to $7.81 per cwt accompanied by a lower coefficient of variation of 0.47. Thus, a cattle feeder would be able to pay $7.24 per cwt for this information and earn the same level of net returns attainable with its use. 
650 0 |a Cattle  |x Feeding and feeds  |x Economic aspects  |z Texas. 
650 0 |a Agricultural prices  |x Forecasting  |x Mathematical models. 
650 0 |a Hedging (Finance)  |x Mathematical models. 
650 4 |a Major agricultural economics. 
655 7 |a Academic theses  |2 lcgft 
700 1 |a Sporleder, Thomas L.,  |e degree supervisor. 
700 1 |a Bessler, David A.,  |e degree committee member. 
700 1 |a Goodwin, Harold L.,  |e degree committee member. 
700 1 |a Wiggins, Steven N.,  |e degree committee member. 
710 2 |a Texas A & M University,  |e degree granting institution. 
856 4 1 |x http://hdl.handle.net/1969.1/DISSERTATIONS-27016  |z Link to OAKTrust copy  |t 0 
856 4 1 |u http://proxy.library.tamu.edu/login?url=http://proquest.umi.com/pqdweb?did=754008101&sid=1&Fmt=2&clientId=2945&RQT=309&VName=PQD  |z Link to OAKTrust copy  |t 0 
994 |a C0  |b TXA 
999 f f |s 4eafee9c-1068-34f0-b983-8de9352fc1a8  |i 5dc89eae-c7d3-3333-8edd-a0a122a0646b  |t 0 
952 f f |p noncirc  |a Texas A&M University  |b J.J. Pickle Campus  |c High Density Repository  |s HDR  |d Remote Storage  |t 0  |e 1987 Dissertation G371  |h Other scheme  |i unmediated -- volume  |m A14839627454 
952 f f |a Texas A&M University  |b College Station  |c Electronic Resources  |s www_evans  |d Available Online  |t 0  |e 1987 Dissertation G371  |h Other scheme 
998 f f |a 1987 Dissertation G371  |t 0  |l Available Online 
998 f f |a 1987 Dissertation G371  |t 0  |l Remote Storage