|   |
 Basis Considerations for LRP Insurance
When using LRP insurance, livestock owners are exposed to a different type of basis risk than when using futures or options hedges. LRP basis is the difference between local cash prices and LRP Actual Ending Value. Chapter four discusses LRP basis in detail.
Topics covered include:
- How LRP basis differs from traditional futures basis;
- Why fed cattle and swine LRP basis are less variable than futures basis;
- Why feeder cattle LRP basis variability is similar to futures basis variability.
Important! USDA-RMA has revised the LRP policy. The 2008 LRP Policy Updates provides detailed information regarding LRP program changes for 2008.
- To view the printed course materials and slides, you will need the Adobe Acrobat Reader
- To view the videos, you will need the free RealPlayer software available from Real.com.
|
|
