Reducing forward buying through derivatives

This thesis examines the potential reduction of speculative inventory, commonly known as "forward buying", through the use of derivatives options, similar to those used on commodities exchanges. The reinforcing cycle of overbuying on promotion, which leads companies and industries into inescapable cycles of capacity excess & shortage, is explored and a framework for breaking free through the sale of call options on promoted products is proposed. Further speculation on the relevance of derivative instruments to Internet Exchanges and Collaborative Planning, Forecasting and Replenishment (CPFR) is advanced.

Department dc:contributor.department

Massachusetts Institute of Technology. Engineering Systems Division.

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2000

Author dc:creator

• Foti, Christopher G. (Christopher Grant), 1971-

Advisor dc:contributor.advisor

• James Masters.

• Engineering Systems Division.

Statement dc:rights

• M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/9158

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/9158