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 Commodity Markets T2044 QR Code
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Commodity Markets



This training program provides a thorough overview of commodity products, trading strategies, and financing methods. This program equips individuals to navigate commodity markets successfully and optimize trading outcomes.

Program Objectives:

At the end of this program, participants will be able to:

  • Review and fully comprehend the methods and processes used in the cash market.

  • Gain knowledge of the regulatory frameworks

  • Describe how risk is managed using derivatives and structured products.

  • Describe the workings of several related derivative products as well as collateralization requirements and problems.

  • Understand intuitively the pricing, hedging, and other problems related to derivative products.

Targeted Audience:

  • Managers of corporate risks.

  • Dealers, Brokers, and Traders.

  • Asset Managers.

  • Managers of Sales Compliance.

  • Portfolio Directors.

  • Audit.

  • Employees in accounting and finance departments.

Program Outline:

Unit 1:

Commodity Market Structure and the Corporate Risk Environment:

  • Corporate operations and the role of commodity risk.

  • Commodity market categories.

  • The unique nature of physical vs financial assets.

  • Market characteristics: Exchange traded vs OTC.

  • Price discovery and market transparency.

Unit 2:

Market Participants:

  • Ags, Energies and Metals – who are the participants.

  • Speculators, hedgers and investors.

  • More detail on energy markets – products, suppliers and consumers.

  • More detail on Metal markets – products, suppliers and consumers.

  • More detail on Ag markets – products, suppliers and consumers.

Unit 3:

Primer on Derivatives: Linear Products:

  • The role volatility, black swans and market blow-ups.

  • Pricing forwards and futures.

  • The cost of carry model.

  • Mean reversion in commodity pricing.

  • Hedging and risk reduction.

Unit 4:

Option Trading II:

  • How option prices change.

  • American vs. European options.

  • Option spread trading – money spread and calendar spread.

  • Taxonomy of option trading methods.

  • Trading strategies involving two options.

  • Trading strategies with three or more options.

Unit 5:

Adjusting risk exposure with option trades:

  • Understanding risk exposure and its significance in trading decisions.

  • Identifying strategies to manage risk through option trades.

  • Hedging techniques using options to mitigate downside risk.

  • Adjusting risk exposure dynamically based on market conditions and portfolio objectives.

  • Evaluating the effectiveness of option trades in achieving risk management goals.

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