Introduction to Commodities and Commodity Derivatives (2022 Level II CFA® Exam – Reading 37)

Prep Packages for the CFA® Program offered by AnalystPrep (study notes, video lessons, question bank, mock exams, and much more):

Level I: https://analystprep.com/shop/cfa-level-1-learn-practice-package/

Level II: https://analystprep.com/shop/learn-practice-package-for-level-ii-of-the-cfa-exam-by-analystprep/

Levels I, II & III (Lifetime access): https://analystprep.com/shop/cfa-unlimited-package-for-level-1-2-3/

Prep Packages for the FRM® Program:

FRM Part I & Part II (Lifetime access): https://analystprep.com/shop/unlimited-package-for-frm-part-i-part-ii/

For FRM (Part I & Part II) Video Lessons, Study Notes, Question Bank, CBT Mock Exams & More: https://analystprep.com/shop/unlimited-package-for-frm-part-i-part-ii/

Topic 8 – Alternative Investments
Reading 37 – Introduction to Commodities and Commodity Derivatives
0:00 Introduction and Learning Outcome Statements
0:21 LOS: Compare characteristics of commodity sectors.
5:41 LOS: Compare the life cycle of commodity sectors from production through trading or consumption.
9:29 LOS: Contrast the valuation of commodities with the valuation of equities and bonds.
12:42 LOS: Describe types of participants in commodity futures markets.
18:45 LOS: Analyze the relationship between spot prices and futures prices in markets in contango and markets in backwardation.
24:20 LOS: Compare theories of commodity futures returns.
32:00 LOS: Describe, calculate and interpret the components of total return for a fully collateralized commodity futures contract.
35:46 LOS: Contrast roll return in markets in contango and markets in backwardation.
36:21 LOS: Describe how commodity swaps are used to obtain or modify exposure to commodities.
44:59 LOS: Describe how the construction of commodity indexes affects index returns.