Using your insights into how futures prices are derived and how commodity futures markets work that you have learned on this course, you are to discuss and critically evaluate the issues involved in the failure of some commodities futures markets to converge as theory would indicate they should.

There is evidence for the manipulation of commodity futures markets. Probably the best known example is the Hunt brothers’ cornering of the silver market. But many other instances of such manipulative practices exist. There are also many instances where the Commodity Futures Trading Commission (CFTC) has prosecuted offenders. Your assignment is the following:

In the light of your understanding of how commodity futures work and the evidence from the academic literature on futures market manipulation, discuss and analyse the problem of manipulation and how it could affect the operation of commodity futures markets