Commodity Market Regulation
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Bubbles, Froth, and Facts: The Impact of Index Funds on Commodity Futures Prices (February 2010)
Two economics professors have published a paper analyzing commodity index trader position data from 2004 to 2009. The professors, Dwight Sanders of Southern Illinois University and Scott Irwin of University of Illinois at Urbana-Champaign, found that a large increase in commodity index positions occurred in select commodity markets. However, that increase took place well in advance of the 2007-2008 boom in commodity prices, the professors said. They also said that statistical tests on the data did not reveal any link between commodity index activity and commodity futures prices.
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