Joshi (2012), studied how commodity futures can be used to hedge against inflation in equities selecting sectoral equity

indices like FMCG, Energy and Auto. Pepper, wheat, steel long and mustard seed are the commodities used for the study. Out of these four commodities only those commodities are selected which have negative correlation with the equity index returns. He tested the hypothesis that the portfolio returns having commodities is higher than the portfolios having only equities. Negative correlations are found between FMCG and Pepper, Auto and Pepper, Energy and Pepper and Energy and Steel long and based on these portfolios are constructed giving equal weights. This study concluded that inclusion of commodity futures reduces the variation in the portfolio returns. However, this study is criticised on the ground that the basis for selecting commodities. The author is not clear on what basis the commodity futures are selected. And the study did not give any clarification that if the port folio weights are changed, what is the impact on the returns. Joshi Anurag ( 2012), Hedging Equities against Inflation using Commodity Futures , 2012
International Conference on Economics and Finance Research, IPEDR Vol.32 (2012)

Jayagurunathan, Velmurugan and Palanichamy (2010) studied the price discovery process and equilibrium relationship between the spot and futures market in India taking an example of Gold. They used Johansens co-integration test and Johansens Error Correction Model for the sample period from 2nd May 2005 to 30th July 2009. The study found that spot market adjusts (rise) itself towards the equilibrium at a greater speed than the futures market. Therefore, this study concluded that spot market is informationally more efficient than the underlying futures market and spot market serves as a primary market for price discovery. Since, this study is limited to only one commodity, i.e., gold, where the price is normally influenced by several domestic and international information. Hence, the generalisation of the results for rest of the commodities is a matter of concern. Using the similar methodology Devanadhen, Srinivasan and Deo (2012) studied the price discovery process using the Gold Mini commodity of Indian market. The results of this study supported the results of Jayagurunathan, Velmurugan and Palanichamy (2010) and concluded that spt market serves as a primary market for price discovery and the price innovations are first aggregate in the spot market and the transmitted to the futures market. Vasisht and Bhardwaj (2010) studied the lead lag relationship and price discovery between commodity spot and futures market of Maize using the Johansens co-integration test and Granger Causality test. They found the unidirectional causality from futures to spot market. Bharadwaj and Vasisht (2010) studied the issue of price discovery with the example of Gram using the spot prices from Bikaner and Delhi and futures prices from NCDEX. They used the model developed by Garbade and Silber (1982) and tested whether a change in the basis of previous time period is correlated with the change in the spot or future prices of the current time period. Using 7 individual contracts trading on several time periods in the year 2008 this study found that in four out of seven contracts, futures market took the leading role in the price discovery process.