Futures For You by Carley Garner
CROPS AND OPTIONS
What are “short-dated new crop options”?
Prior to a few years ago, grain traders wishing to speculate on the new crop price of corn, soybeans, or wheat through options were required to purchase or sell options with expiration dates in the distant future. As a result of the excessive time value built into the option prices, short-term hedges or speculations on new crop prices were often high-risk and expensive ventures. In response to the noted struggle, the CME Group launched a line of short-dated new crop options (SDNC).