A put option is a tool that dairy farmers can use to reduce risk. It is basically a form of price insurance. The main benefit of a put option is not to increase your gross income, but to reduce the variability of income. This computer program that can be downloaded from this page has been developed to simulate risk management using put options. This program simulates a year of milk income for a dairy farmer. You have the opportunity to compare what would happen both with and without put options.
Organization |
Kentucky State University Extension |
Publisher |
University of Kentucky |
Publication Views |
1174 |
Material Type |
App |