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dc.contributor.authorMuermann, Alexanderen_US
dc.contributor.authorShore, Stephen H.en_US
dc.date.accessioned2006-08-07en_US
dc.date.accessioned2009-07-24T13:47:51Z-
dc.date.available2009-07-24T13:47:51Z-
dc.date.issued2006en_US
dc.identifier.piurn:nbn:de:hebis:30-25980-
dc.identifier.urihttp://hdl.handle.net/10419/25473-
dc.description.abstractWhen a spot market monopolist has a position in a corresponding futures market, he has an incentive to deviate from the spot market optimum to make this position more profitable. Rational futures market makers take this into account when setting prices. We show that the monopolist, by randomizing his futures market position, can strategically exploit his market power at the expense of other futures market participants. Furthermore, traders without market power can manipulate futures prices by hiding their orders behind the monopolist’s strategic trades. The moral hazard problem stemming from spot market power thus provides a venue for strategic trading and manipulation that parallels the adverse selection problem stemming from inside information.en_US
dc.language.isoengen_US
dc.publisherCenter for Financial Studies Frankfurt, Mainen_US
dc.relation.ispartofseriesCFS Working Paper 2006/07en_US
dc.subject.jelD82en_US
dc.subject.jelG13en_US
dc.subject.ddc330en_US
dc.subject.keywordStrategic Tradingen_US
dc.subject.keywordManipulationen_US
dc.subject.keywordSpot Market Poweren_US
dc.titleStrategic trading and manipulation with spot market poweren_US
dc.typeWorking Paperen_US
dc.identifier.ppn515334006en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
dc.identifier.repecRePEc:zbw:cfswop:200607-
Appears in Collections:CFS Working Paper Series, Universität Frankfurt a. M.

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