What marketing tool would be used in the futures market by someone who owns a commodity such as milk and intends to sell it sometime in the future?(a) Basis contract(b) Pooling contract(c) Short Hedge(d) Speculating buyerThe question was asked at a job interview.The question is from Quality in division Quality parameters of Dairy Engineering

What marketing tool would be used in the futures market by someone who

1.	What marketing tool would be used in the futures market by someone who owns a commodity such as milk and intends to sell it sometime in the future?(a) Basis contract(b) Pooling contract(c) Short Hedge(d) Speculating buyerThe question was asked at a job interview.The question is from Quality in division Quality parameters of Dairy Engineering
Answer» The correct option is (C) Short Hedge The EXPLANATION is: A short hedge is an investment STRATEGY that is focused on mitigating a risk that has already been TAKEN. The “short” portion of the term refers to the act of shorting security, usually a derivatives CONTRACT, which hedges against potential losses in an investment that is held long. It will enable the futures market by someone who owns a commodity such as milk and intends to sell it sometime in the future.

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