In order to transfer the huge risk of iron ore spot market, to begin with, this paper analyzes the relationship between spot and future price of rebar and presents that rebar futures (RB) in Shanghai Futures Exchange (SHFE) can reflect concerning information efficiently. Secondly, based on the close relationship between SHEF RB settlement price and iron ore price, it attempts to hedge the risk in spot iron ore with RB futures. Besides, based on the study of this paper, it gives some recommendations.
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