Show/Hide Menu
Hide/Show Apps
Logout
Türkçe
Türkçe
Search
Search
Login
Login
OpenMETU
OpenMETU
About
About
Open Science Policy
Open Science Policy
Open Access Guideline
Open Access Guideline
Postgraduate Thesis Guideline
Postgraduate Thesis Guideline
Communities & Collections
Communities & Collections
Help
Help
Frequently Asked Questions
Frequently Asked Questions
Guides
Guides
Thesis submission
Thesis submission
MS without thesis term project submission
MS without thesis term project submission
Publication submission with DOI
Publication submission with DOI
Publication submission
Publication submission
Supporting Information
Supporting Information
General Information
General Information
Copyright, Embargo and License
Copyright, Embargo and License
Contact us
Contact us
Is food financialized? Yes, but only when liquidity is abundant
Date
2018-10-01
Author
ORDU, Beyza Mina
Oran, Adil
Soytaş, Uğur
Metadata
Show full item record
This work is licensed under a
Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License
.
Item Usage Stats
280
views
0
downloads
Cite This
In this paper, we investigate whether commodity index trader (CIT) positions help to explain the increase in the correlations between agricultural commodities and equities starting around 2008. Some argue institutional investors who invest both in stock and commodity markets demolish the borders between these two seemingly unrelated markets and increase correlations, a recent phenomenon known as financialization. Yet, some others argue recently correlations have decreased back to historical levels and the increase between 2008 and 2012 was merely due to a business cycle effect. Our results do not support one side at the expense of the other but rather shows that both factors are important in explaining the correlations between agricultural commodities and stocks. Furthermore, we find that CITs prefer to go back to their circle of competence under scarce liquidity and thus correlations decrease back to levels absent institutions. Hence, low liquidity is a significant obstacle inhibiting financialization to occur.
Subject Keywords
Financialization
,
Commodities
,
Liquidity
,
Financial crisis
,
Index funds
URI
https://hdl.handle.net/11511/42007
Journal
JOURNAL OF BANKING & FINANCE
DOI
https://doi.org/10.1016/j.jbankfin.2017.06.001
Collections
Department of Business Administration, Article
Suggestions
OpenMETU
Core
Do Stock Index Futures Affect Economic Growth? Evidence from 32 Countries
Şendeniz Yüncü, İlkay; Aydoğan, Kürşat (2018-01-26)
This article investigates the relationship between stock index futures markets development and economic growth using time-series methods for 32 developed and developing countries. Evidence of cointegration between stock index futures and real economy in 29 countries suggests the presence of co-movements among the variables, indicating long-run stationarity in those countries. Our findings show that there is Granger-causality from stock index futures markets development to economic growth for middle-income c...
Managing financial instability in emerging markets: A Keynesian perspective
Akyüz, Yılmaz (Orta Doğu Teknik Üniversitesi (Ankara, Turkey), 2008-6)
The Keynesian analysis of financial instability as developed by Hyman Minsky provides considerable insights into understanding the nature and dynamics of boom-bust cycles driven by international capital flows in emerging markets. Its main policy conclusion that financial control rather than macroeconomic policy holds the key to financial stability is equally valid. There is, however, need to develop a new approach to financial control and place greater emphasis on managing capital inflows than has hitherto ...
Financial crises and the nature of correlation between commodity and stock markets
ÖZTEK, MEHMET FATİH; Öcal, Nadir (2017-03-01)
This paper models time-varying correlations between commodity and stock markets to uncover the dynamic nature of correlations during the financialization of commodity markets and in the aftermath of the recent financial crisis. Particularly, we search for upward trends in correlations and investigate the impacts of global and market volatility, and the news from the markets on the time-varying structure of correlations. The focus is on two commodity sub-indices; agricultural commodity and precious metal. Ne...
The role of trading volume, open interest and trader positions on volatility transmission between spot and futures markets
Ordu-Akkaya, Beyza Mina; Ugurlu-Yildirim, Ecenur; Soytaş, Uğur (2019-06-01)
In this paper, we investigate the role of open interest, trading volume and trading positions of trader groups on volatility spillover between futures and spot markets of two major commodities; oil and gold during the last two decades. The initial analysis including only spot and futures markets imply that the relationship is bi-directional for crude oil, and uni-directional for gold. Though, including open interest and trading volume enrich our results indicating open interest and spot markets are closely ...
Does foreign portfolio investment strengthen stock-commodity markets connection?
ORDU AKKAYA, BEYZA MİNA; Soytaş, Uğur (Elsevier BV, 2020-03-01)
The heavy influx of financial institutions into commodity markets is referred to as financialization of commodities and this phenomenon argues that financial institutions increase the connectedness between commodity and stock markets through simultaneous investing. In this paper, employing Treasury International Capital data by US Treasury to proxy for institutional investment, we investigate the role of foreign portfolio investors on increasing spillovers between commodity and stock markets. We include dev...
Citation Formats
IEEE
ACM
APA
CHICAGO
MLA
BibTeX
B. M. ORDU, A. Oran, and U. Soytaş, “Is food financialized? Yes, but only when liquidity is abundant,”
JOURNAL OF BANKING & FINANCE
, pp. 82–96, 2018, Accessed: 00, 2020. [Online]. Available: https://hdl.handle.net/11511/42007.