to nine-day intervals and watch the success or
failure of their strategy develop by referring
to various , summary screens accessible
through the Trading Alternatives Menu. This
process can be an informative learning ex-
perience and simulates the reality of having to
wait to see the results of one’s decisions. But
it does take time. An option exists under the
“End Game” alternative of the Trading Alter-
natives Menu to allow the game to automati-
cally proceed to the last 10 days of trading. At
this point, control is returned to the player to
allow him/her to choose a specific closeout
date. This option is available in both the grain
and livestock game. Use of this option will
speed up the game for experienced players.
Upon terminating the game, the player has
the choice of continuing to play the same game
with his/her score being carried cumulatively
from game to game, starting over with the
same commodity and a new score, or switching
to the other commodity. The purpose of keeping
a cumulative score is to provide an equitable
evaluation of the player’s marketing skills.
The player who consistently chooses better
marketing strategies is likely to win a multi-
round game while losing one or more individ-
ual rounds of the game.
REVIEW AND USE
The program was continually reviewed by
several faculty and graduate students during
its development. Since its release, informal
review of the program has been received from
four groups who have used the program. The
first consisted of more than 100 university
extension personnel and other participants at-
tending an Options Teaching Workshop spon-
sored by the Chicago Board of Trade. Each
person at the workshop was given a demon-
stration of the program and a copy of it. The
second group was formed by a local state
agricultural area specialist who used the pro-
gram in conducting hedging workshops for
county extension personnel and producers.
Thirdly, the program has been used in several
university classes to assist in presenting
futures market concepts. It has then been
made available to students to use in-
dependently for further study. The fourth
source of review came from Colorado State
University, which has used the program in its
Extension Division. Evaluation and feedback
from all of the users has been informal,
positive, and constructive.
As previously stated, the Market Risk
Game is primarily designed to supplement lec-
tures and short courses. A useful way to in-
troduce the game, if possible, is to operate it
in a live classroom demonstration using a big-
screen T.V. or projection device. One or two
games can be simulated with all decisions
discussed as they are made and the results
critiqued as they evolve. The focus of the
demonstration game should not be on the
game’s computer operational procedures
(these are relatively self-explanatory), but in-
stead should be on getting the players to start
thinking about how to use the game to learn.
A rather distinct learning pattern exists in
using the game. Initially players focus upon
confirming that the mechanics of hedging and
using put options are functioning as they
perceive they should. Misconceptions are fre-
quent. In a number of cases, the misconcep-
tions can be self-corrected by the player
through the information menus contained
within the game. However, it is also useful to
have personnel available to answer questions
as the game is played. The most frequent
questions deal with whether undesired results
occurred because of improper use of the
futures market or unexpected actions in the
market.
After the game has been played three to
four times, the players begin to shift their
focus from the mechanics of hedging and op-
tions toward analyzing which tools/strategies
work best under what conditions and why. It
is at this point that the game’s comparative
advantage as a teaching tool is believed to
exist. The comparative analyses provided by
the game are used to study alternative market
situations and to evaluate after-the-fact the
success or failure of given decisions. The
game’s challenge of making a profit is strived
for. With experience, players achieve the
ability to make profits more frequently than
losses. Most find this rewarding and reassuring.
A final and more subtle set of learning
experiences is achieved by a number of
players. Players Ieam to accept the fact that
in a stochastic world one cannot always “win”
even though good decisions are made. They
realize that with stochasticness comes im-
perfect knowledge and the chance that hind-
sight will reveal that good decisions were
made, but they nevertheless turned out to be
less than optimal. Players also begin to
evaluate exactly what their objectives are and
what “winning” means in the context of the
game as well as in an actual risk management
situation. Trade-offs between remaining
unhedged, hedging, or using put options begin
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