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Grabill, Indiana | We met with a broker today to discuss strategies to protect the price of our '14 crops.
He suggested a strategy of forward contracting a portion of the crop then buying an out of the money call on the nearby contract. If I understand the strategy correctly we will set a floor of with the forward contract the keep the upside open with potential appreciation in the value of the call option if the contract price rises.
How does this strategy appear to you?
Jim | |
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Entering the Futures Market to Protect Price
