Euro-training Center
 Commodity Markets Products Trading and Financing T2044 QR Code
Share   Like Download Brochure (PDF) Dates and locations

Commodity Markets: Products, Trading and Financing



Commodities have drawn a wider range of market participants looking for returns and enhanced exposures to a broad range of asset classes, which has led to a significant rise in interest in commodity markets around the world in recent years. This increase is not just attributable to rising living standards and the corresponding changes in consumption patterns. Currently, commodities play a significant role in the portfolios of asset managers and hedge funds, among others. All market players now have access to a wider range of instruments thanks to physical processes related to these markets, such as improved processing, genetic alterations of organisms, and improved risk management systems.

The emphasis of this study is on identifying and comprehending the dangers and nuances of derivatives structures and transactions from the viewpoints of the creator, processor, and financial institutions. Its goal is to give business and risk managers the knowledge and abilities they need to adequately identify, comprehend, evaluate, and mitigate the shifting risks that the cash and derivatives markets present.

Course Objectives

At the end of this course, 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

  • personnel in accounting and finance
  • Managers of corporate risks
  • Dealers, Brokers, and Traders
  • Asset Managers
  • Managers of Sales Compliance
  • Portfolio Directors
  • Audit

Course 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

  • Managing risk and hedging

Select training course venue