Is the Australian wool futures market efficient as a predictor of spot prices?

Giles and Goss (1980) have suggested that, if a futures market provides a forward pricing function, then it is an efficient market. In this article a simple test for whether the Australian Wool Futures market is efficient is proposed. The test is based on applying cointegration techniques to test the Law of One Price over a three, six, nine, and twelve month spread of futures prices. We found that the futures market is efficient for up to a six-month spread, but no further into the future. Because futures market prices can be used to predict spot prices up to six months in advance, woolgrowers can use the futures price to assess when they market their clip, but not for longer-term production planning decisions. (C) 1999 John Wiley & Sons, Inc.

Life-history consequences of divergent selection on egg size in Drosophila melanogaster

Life histories are generally assumed to evolve via antagonistic pleiotropy (negative genetic correlations) among traits, and trade-offs between life-history traits are typically studied using either phenotypic manipulations or selection experiments. We investigated the trade-off between egg size and fecundity in Drosophila melanogaster by examining both the phenotypic and genetic relationships between these traits after artificial selection for large and small eggs, relative to female body size. Egg size responded strongly to selection in both directions, increasing in the large-egg selected lines and decreasing in the small-egg selected lines. Phenotypic correlations between egg size and fecundity in the large-egg selected lines were negative, but no relationship between these traits occurred in either the control or small-egg selected lines. There was no negative genetic correlation between egg size and fecundity. Total reproductive allocation decreased in the small-egg selected lines but did not increase in the large-egg lines. Our results have three implications. First, our selection procedure may have forced females selected for large eggs into a physiological trade-off not reflected in a negative genetic correlation between these traits. Second, the lack of a negative genetic correlation between egg size and number suggests that the phenotypic trade-off frequently observed between egg size and number in other organisms may not evolve over the short term via a direct genetic trade-off whereby increases in egg size are automatically accompanied by decreased fecundity. Finally, total reproductive allocation may not evolve independently of egg size as commonly assumed.