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I'm curious to know from someone who understands better- isn't this the kind of volatility that futures markets are intended to prevent? If actual product movem
by 0_____0 2y ago
I'm curious to know from someone who understands better- isn't this the kind of volatility that futures markets are intended to prevent? If actual product movement has changed significantly then is it just that this moment is especially volatile, or are futures as a mechanism not particularly meant to deal with this?
- woleium 2y agoThat was always touted as a reason, yes. I am sure it is partly true, within certain bounds.
- shermantanktop 2y agoFutures aren’t meant to do anything, are they? Like so much of the market, they are just another partial-information lottery which isn’t explicitly forbidden by weak regulators. (But I’m not someone who knows better)
- jgalt212 2y agofutures markets (among other things) allow producers to temporally match assets and liabilities.
- Marazan 2y agoFutures market started as a way of (and in America were strictly limited to) prpducers and wholesale buyers to hedge/fix their costs. Then American regulators started handing exceptions to allowable market participants out like candy and suddenly the markets are majoritarily financial middlemen who do not want to take delivery. Futures markets make lots of sense and are very useful. How they are currently constituted does not.