The jewelry industry faces price and margins risk from exposure to the precious metals’ markets. This study aims to provide a better understanding of the risk management tools available and demonstrate how implementing an effective risk management strategy can benefit your bottom line.  We will review the origins of commodity hedging and examine several of the current risk management tools available, such as the futures and the Over-the-Counter (OTC) markets. We will compare and contrast the benefits of these hedging instruments. Also, we will demonstrate how to implement these price risk management tools and discuss the advantages of adding a hedging strategy to a company's risk management procedures. Our goal in this study is to allow you to better evaluate your needs and options towards building a successful risk mitigation strategy.

Author: Jaeson Parsons