Commodity Position Limit Rules Should Be Based on a Finding of Necessity

6 Pages Posted: 8 Aug 2015

See all articles by Hilary Till

Hilary Till

Premia Research LLC; EDHEC-Risk Institute; J.P. Morgan Center for Commodities, University of Colorado Denver Business School; Global Commodities Applied Research Digest

Date Written: May 8, 2013

Abstract

One hopes that the CFTC will carefully consider how necessary and appropriate the imposition of speculative position limits is, across commodity markets. This article argues that before making such a finding, the agency should (a) review the empirical evidence on the causes of both commodity price volatility and price spikes and (b) study how market participants have learned and responded to the Global Financial Crisis of five years ago.

Keywords: Commodity markets, hedgers, speculators, futures markets, risk, position limits

JEL Classification: G1, G11, G18

Suggested Citation

Till, Hilary, Commodity Position Limit Rules Should Be Based on a Finding of Necessity (May 8, 2013). Available at SSRN: https://ssrn.com/abstract=2641331 or http://dx.doi.org/10.2139/ssrn.2641331

Hilary Till (Contact Author)

Premia Research LLC ( email )

United States
312-583-1137 (Phone)
312-873-3914 (Fax)

HOME PAGE: http://customindices.spindices.com/custom-index-calculations/premia/all

EDHEC-Risk Institute

Nice
France

HOME PAGE: http://risk.edhec.edu/

J.P. Morgan Center for Commodities, University of Colorado Denver Business School ( email )

1475 Lawrence St.
Denver, CO 80202
United States

HOME PAGE: http://www.business.ucdenver.edu/commodities

Global Commodities Applied Research Digest ( email )

J.P. Morgan Center for Commodities
1475 Lawrence Street
Denver, CO 80202
United States

HOME PAGE: http://www.jpmcc-gcard.com/hilary-till

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