Zavadska, Miroslava and Morales, Lucia and Coughlan, Joseph
(2018)
The Importance of Integrating Quantitative Research Methods to Understand Commodity Business Finance.
International Journal of Business & Management, 6 (1).
pp. 54-77.
ISSN 2336-2197
Abstract
There is significant array of quantitative methods used to analyse the basic properties and
behaviour of commodity markets. This study focuses on how integrating these methods can aid our
understanding of how crude oil markets behave during major shock events that exhibit high levels of
uncertainty and risk exposure to businesses that rely on commodities to function. The study
considers the relationship and behaviour of spot prices of major oil benchmarks: Brent crude oil (the
European crude oil benchmark), the West Texas Intermediate (the US benchmark) and the Dubai
crude oil (the Middle East benchmark). The research framework under consideration can bring value
to businesses, and practitioners, as it offers opportunities to identify, and measure, how oil prices
variations impact on the costs of business operations. A clearer understanding of oil price dynamics
aids the decision maker with complex decisions such as strategic investment and sourcing of raw
materials. These issues can be quantified and then integrated into operational plans, and hedging
strategies can be implemented to minimise risk exposure to oil market fluctuations. Through the
implementation of an integrated battery of research methodologies commonly used to model oil
prices, this paper contributes towards the operationalisation of econometric modelling in business.
This study considers that markets are not as predictable as it was once thought, and decisions are, in
reality, made based on how we, as humans, think and engage with the organisational environment.
Financial models and theories can offer support to practitioners when measuring cost implications
for their businesses
| Item Type: |
Article
|
| Keywords: |
Business finance; Multi method research; Commodity; Energy; Shock periods; Cointegration;
Causality; Volatility; Efficiency; Decision-making; |
| Academic Unit: |
Faculty of Social Sciences > School of Business |
| Item ID: |
11823 |
| Identification Number: |
https://doi.org/10.20472/BM.2018.6.1.005 |
| Depositing User: |
Joseph Coughlan
|
| Date Deposited: |
28 Nov 2019 10:08 |
| Journal or Publication Title: |
International Journal of Business & Management |
| Publisher: |
International Institute of Social and Economic Sciences (IISES) |
| Refereed: |
Yes |
| URI: |
|
| Use Licence: |
This item is available under a Creative Commons Attribution Non Commercial Share Alike Licence (CC BY-NC-SA). Details of this licence are available
here |
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