A Comparison of the Effectiveness of Using Futures, Options, LRP Insurance, or AGR-Lite Insurance to Manage Risk for Cow-calf Producers

A comparative analysis was performed looking at using cash, futures, options, or insurance to manage the price of calves for cow-calf producer. Risk can be reduced with the futures market and with options or LRP insurance. Options and LRP insurance are equivalent in the amount of risk that is reduced. AGR-Lite does not appear to be an effective policy at reducing risk for cow-calf producers.