Leveraging Technological Advances to Manage Risk
The ability to manage and utilize accurate forward price curves has always been an important aspect of commodity trading and risk management — indeed, it is at the very heart of price risk management. Despite this, the collection of price time series data and the creation, validation and maintenance of curves, has also always proven to be somewhat problematic – particularly in illiquid, thin and/or real-time markets.
Read the document online or download it from the CTRM Center The Importance of Real-Time Forward Curves
Since ETRM software was first introduced around 20-years ago, developers have continually sought to move from developing solutions designed to support specific commodities such as crude oil, natural gas, and electric power, to building solutions that catered for multiple energy commodities. In part, their objective was to reduce costs – specifically integration costs, but without a doubt, part of the objective was self-serving, as this also allowed them to broaden the appeal of their software to a larger and more lucrative market.
Read the document online or download it from the CTRM Center Multi-commodity ETRM’s are becoming too expensive to implement, and maintain – so what’s the solution?
Energy Trading and Risk Management (ETRM) solutions have now been a part of the broader wholesale energy trading application landscape for around 20-years, having evolved in step with both business and technology trends over that time period. As a result of this evolutionary process, there are a large number of diverse solutions on the market that address any number of combinations of industrial segments, energy commodities, geographic locations, and functional reach.
Read the document online or download it from the CTRM Center The New Generation of ETRM Systems
While delivery of applications and services in the cloud has been a part and parcel of business for over a decade, adoption of cloud-delivered CTRM applications (not to be confused with hosted solutions), has taken time to develop. However, the collapse in commodity prices and profitability over the last several years has incentivized firms in the commodities space to rethink their approach to acquiring and managing IT solutions.
With increasing market experience with these products, market activity over the last few years indicates that adoption of cloud CTRM solutions is increasing rapidly as the lower cost of entry, benefits of a pay as you go approach, and realization that the cloud can actually be more secure than on-premises, have all aided its growth.
Read the document online or download it from the CTRM Center Leveraging the Cloud for Improved Performance in Agricultural Trading Operations
The North American energy markets, influenced by both domestic and international developments, are undergoing a rapid evolution that has and continues to challenge energy commodity producers, processors, and traders. Driven by technical innovation, regulatory intervention and globalization, the changes occurring have impacted the entirety of the energy supply chain – establishing new pricing correlations, increasing operational complexities and creating new markets and trading hubs…and, by extension, created vast new pools of data and information that must be considered when formulating market strategies and trading decisions.
Despite these challenges, for those properly equipped with the tools and applications that can capture, analyze and support real-time decision making, there are any number of new opportunities to profit in this complex environment.
In this white paper we will examine the ongoing changes and the resultant challenges in a few of the most rapidly evolving North American energy markets, and discuss an approach to address those challenges through sophisticated real-time data aggregation and analytics.
Read the document online or download it from the CTRM Center Improving Data Aggregation and Analysis to Address Challenges of an Evolving Energy Market
Commodity Technology Advisory LLC (ComTech), the leading analyst firm covering commodity trading and risk management (CTRM) technology markets, has recently completed its biannual in-depth review of the CTRM software market space in order to compile an estimate of the size of the global CTRM technology market and prepare an outlook for growth across the various component submarkets that comprise it.
Readers of this report should be aware that in the development of this data, as in past years, we must delineate boundaries for the companies and applications reflected in the scope of the analysis.
Read the document online or download it from the CTRM Center 2016 – 2021 CTRM Market Outlook
Commodity producers, traders, and industrial consumers are all facing a barrage of risks such as price exposure and cyber vulnerability, as well as legal, credit, operational and market risks. The risks associated with buying, selling, and moving commodities only seem to be increasing exponentially with greater regulatory oversight and a broadening of supply chain operational issues like traceability. Many of these risks can be business killers – the actions of rogue traders or the impact of counterparty business failures, for example – and lead to fatal damage such as an inability to access capital or damage to brands (via issues around sourcing commodities or producing substandard end-products). Other risks, such as ineffective price risk management, inefficient scheduling of transportation, or regulatory non-compliance can erode profitability and damage the company’s ability to execute on strategic plans and growth initiatives.
Of course, often where there is risk, there is also an opportunity to profit – but only when those risks are recognized, effectively managed, and properly mitigated. The rise in stakeholder scrutiny and regulatory oversight also means that being able to demonstrate effective risk management across the organization is certainly more important today than ever before.
Read the document online or download it from the CTRM Center Risk Monitoring and Management Trends In Commodities