If you're reluctant to use options on futures, there's a way to use them to protect short-term prices with-outfacing sky-high premium costs. It may be just the tool to hedge against a critical crop report or other issue that can ruin a rally.Short-dated new-crop (SDNC) options, available since mid-2012 from the CME Group, Chicago, provide a short-term alternative for trading new-crop corn and soybeans, as well as hard red winter wheat and soft red winter wheat. CME reports that more than 2.5million SDNC contracts have been used.The primary difference between SDNC and standard options is that SDNC options expire at various points throughout the growing season, earlier than standard new-crop options. However, they are tied to a longer-dated new-crop futures contract.
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