Is speculation good for commodity futures markets
The Forwards Market Commission and many analysts claim that speculators are different from gamblers since they do not create risk, but merely accept the risk which already exists in a futures market.
According to them, speculators try to assimilate all the possible price-sensitive information, on the basis of which they can expect to make profit. Therefore, it is claimed that the speculators contribute in improving the efficiency of price discovery function of the futures market.
