IMPORTANCE OF THE FUTURES MARKETS FOR CROATIAN TEXTILE INDUSTRY

Central role of commodity exchanges is neutralization of financial and commodities price risk, providing effective risk management tools for basic industries and earning opportunities jar well-informed investors. Conducting interview with managers in Croatian textile industry led to the conclusion that there was insufficient knowledge of futures trading techniques and opportunities. This paper analyse basic prerequisites for commodity trading, followed by cotton market analyse. For over a century cotton industry participates at futures and options market to engage in cotton price discovery and price risk transfer. With respect to pricing role of commodities exchange, this paper analyse hedging opportunities in Croatian textile industry.