Bivariate GARCH model reduces risk in Malaysian crude palm oil futures.
The study looked at how well crude palm oil futures in Malaysia can be used to reduce risk. They used different models to calculate the best way to hedge against risk, finding that the bivariate GARCH model was the most effective. They also found that using the nearest futures contract was better for hedging than using contracts further in the future. This means that investors can use crude palm oil futures, especially the nearest contract, to protect against risk.