An Analysis Of The Impact Of The Commodity Futures Market On Relevant Listed Company Performance

Given China's historical status as a large agricultural producer,the issue of food security is one that is of vital importance to the development of the domestic economy.Currently,the domestic agricultural industry is moving towards modernization by employing practices such as: utilizing market tools for price stabilization,providing incentives to increase farming output,and enhancing farmer income.As such,commodity futures provide a good platform for agricultural modernization.Given that prices are closely related in the futures,spot,and stock markets,we can thoroughly examine the impact of commodities futures market on listed company performance and the impact of hedging on company value,relative value and profitability.Then we compare the volatility of stock return among companies having carried out hedging and those have not.By studying agricultural futures and their corresponding effect on publicly listed companies' share prices,investors are able to make better and more practical investment decisions.Furthermore,based on the trends of agricultural futures prices,investors are able to develop more accurate expectations for company-specific business developments.