Tips from a veteran who part of the marketing operation on
uses options and knows the my farm. Most marketing educators
do not fully explain these pitfalls
^{pitfalls farmers face} to the farmer who is about to put

premium money on the line.

Here are six tips that I’ve picked up in 24 years of option use.

ptions on agricultural futures have been trading since 1984.

While the principle of op- People who sells options are tions is similar to that of insurance, most often professional traders. That options have never really caught on means that farmers learning options in a big way with farmers. A com- are pitting their lack of experience mon belief is that 90% of options against full-time options expire worthless. This makes them professionals with almost unlimited profitable to the seller, not the buyer. price data and computer power who

I cannot vouch for the 90% as- can do almost any analysis desired. sumption. However, I have learned some things from using options as

2008

2006 ²⁰⁰⁷

2005

MAINTAIN YOUR GAIN

For illustration only.

WI_{N A 2009 FORD F-150!} No purchase necessary. Open to farmers 18 years of age or older who are legal residents of the 50 United States/D.C. or Canada (excluding Quebec). Void where prohibited. Ends 2/28/09. See any Case IH dealership or www.CaseIH.com for official rules and details.