| With the globalization of world economy and the overall economic internationalization of our country, Chinese enterprises have to face the risks and challenges of the outside world if they intend to realize the long-term stable growth in the globalized reproduction, especially the fluctuations risk of commodity and asset price in the international market. Risk prevention has become an unavoidable new enterprise management topic.So, how to elude the international market price risk? Making scientific risk and asset preservation by the price discovery and hedging function of the futures market can help enterprises effectively circumvent the international market price fluctuations risk, achieve sound development and establish competitive advantage. Commodity hedging of the enterprises is the practice of buying/selling contract the same or relevant with the commodity in contrary direction for a specific quantity and quality at a predetermined time. It takes a position in commodity hedging market to offset and balance against the fluctuation risk adopted by assuming a position in a spot good market.Taking Linear Low Density Polyethylene(LLDPE) hedging in Dalian Commodity Exchange of China as the point of penetration and combining with enterprises’ specific business practices, the article demonstrates the international economic situation, the price fluctuation risk in the market enterprises faced and the practical significance of corporate hedging; studies the rudimental theory of hedging and the basis differential theory; looks into the basis differential in aspects of externality, interval analysis, seasonal element and tendency to design a commodity hedging strategy based on the result; exemplify the corporate hedging practices as well as basis differential and further extensions at the end. The significance of this article is to sort out the research thought of corporate hedging and sum up its experience, thus ensure a steady development for the enterprise in the future. |
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