What were the effects of commodity financialisation and why is this important for market participants as well as for policy makers?


We would like you to begin by reading the following research papers:

Bhardwaj, Geetesh, Gary Gorton and Geert Rouwenhorst (2015), “Facts and Fantasies about Commodity Futures Ten Years Later”, NBER Working Papers 21243, National Bureau of Economic Research, Inc. Available at: http://www.nber.org/papers/w21243.pdf

Cheng, In-Haw and Wei Xiong (2014), “Financialization of Commodity Markets”, Annual Review of Financial Economics 1(6), 419-44, Available at:https://www.annualreviews.org/doi/10.1146/annurev-financial-110613-034432(earlier version, acceptable for this activity as well is here: http://www.nber.org/papers/w19642 )

In addition, we would also like you to read the following Financial Times articles:

“Bunge says China lenders dostorting soybean trade”, by Gregory Meyer, February 12, 2015
“Commodities explained: China’s new normal”, by Henry Sanderson, February 23, 2015
“Investment: Revaluing commodities”, by Gregory Meyer and John Authers, June 3, 2015
“Financialisation compounds commodity rout” by Satyajit Das, December 29, 2015
“Speculators march into China commodities” by Henry Sanderson, April 27, 2016
“A once timeless skill in commodities investing is under threat” by Gregory Meyer, July 6, 2018

There has been a debate in academia and the financial industry about the topic of commodity financialisation. Commentators focus on asking if commodity financialisation has significantly influenced commodity markets and the process of commodity price determination.

Complete the following two tasks:
Summarise the views presented in the two above research articles and link them to the views that financial industry holds about the effects of commodity financialisation for investment opportunities.

In the light of what you have learned in this course so far (especially of the Theory of Normal Backwardation and Theory of Storage), discuss how, in your opinion, commodity financialisation has affected the relation between spot and futures prices for commodities?

In preparing your answers to the above questions (please write around 300 words for each question), you may find it useful to reflect on the queries below in order to help help direct your thoughts.

Note – you are not required to answer these queries specifically in the written answers to the above two questions.
What does the term commodity financialisation represent?
What were the reasons for commodity financialisation?
Who were the main market participants in commodity futures markets before commodity financialisation and after that?
What were the effects of commodity financialisation and why is this important for market participants as well as for policy makers?

What were the effects of commodity financialisation and why is this important for market participants as well as for policy makers?

Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
The price is based on these factors:
Academic level
Number of pages
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more