Published Paper Details:

This paper understands the concepts of derivatives, hedging and analyzes the Indian Aviation Sector in India. This paper reviews thirty published articles by renowned authors to further understand this field of research. This paper collects the data of Crude Oil prices, Aviation Turbine Fuel prices, Brent prices among others. This paper analyzes the data using models such as Descriptive Statistics, Correlation, Regression, GARCH Model, One-Way ANOVA Test, Unit Root Test, Co-integration and the Granger�s Causality test. The analysis provides desirable results and helps further interpretation and analysis. The results of the analysis also help develop good strategies for airline companies. This paper finds that Crude Oil Prices and Aviation Turbine Fuel prices are highly positively related whose correlation is almost perfect positive (0.98 correlation). The Crude Oil daily future prices do not show any effect of GARCH which shows that its volatility is not significant. The GARCH of Aviation Turbine Fuel prices is significant which helps the authors develop a strategy. Finally, the authors recommend that airline companies use Crude Oil as a proxy hedge for Aviation Turbine Fuel. Hedging using this proxy will help airlines reduce uncertainties and aid better financial planning and provide higher shareholder�s wealth.