Learning Platform - "Trade Compliance & Surveillance"

Course: Fundamentals of Trading

About the Course

Acquiring insight and knowledge of:

  • The fundamentals of (energy) trading & risk management;
  • The role of trading (organisations) and the interaction with the in/external environment;
  • The role of risk management and its position within organisations;
  • The role of regulation and the consequences for organisations and their environment;
  • The role of accounting (rules) for trading(-related) organisations.

Course Contents

Liberalisation of the Energy Markets

What is aim of liberalisation? What are the consequences? The EU 3rd energy package.

Risk – What is it?

Risk and return; risk-reward ratio; risk versus uncertainty; quantification versus qualification of risk.

Market risk – What is it?

Price risk; hedging; market characteristics, such as location, delivery time/period, time to maturity.

Risk management

Identification of risk, measuring risk and control of risk; liquidation, insurance and hedging.

Volatility – What is it?

The concept volatility explained; the calculation and the interpretation of volatility figures.

Counterparty risk – What is it?

Credit risk and delivery risk; the consequences of hedging for market risk and counterparty risk.

Credit risk management

Clearing; the concept of netting; credit limits; ratings; sleeving; systemic risk and regulation.

Liquidity & Liquidity risk

Market liquidity versus funding liquidity; indicators for market liquidity; position limits.

The trading organisation – The role of trading business unit

Interaction between the sales department and trade and between generation and the trading unit.

The trading organisation – Front, Middle & Back Office

Departments and sub-departments within the trading business unit, and their role.

Trading – What is it and how is it organised?

Trading versus procurement and sales; decision making & connectivity; trading tools & data.

Trading – The reasons for concluding transactions

About procurement, sales, balancing, hedging, arbitrage and speculation. Why is it applied?

Trading – The order book

How does trading take place? How are prices set? What orders are executed? When? How?

Trading – Order types

What order types are applied and for what reasons? Market, limit, all-or-none, iceberg & stop-loss order.

Trading process – Clearing

Central counterparty; clearing house & clearing members; credit risk; margining & collateralisation.

Trading process – Settlement

Physical delivery versus cash settlement; settlement procedures; examples with calculations.

Trading process – Transaction flow

Pre-trade, trade and post-trade processes; tasks & responsibilities of front/middle & back office staff.

Trading process – ETRM system

The task of energy trading and risk management software; the users and purposes of the tool.

Markets & Products – Spot versus Forward

The difference between spot/prompt and forward/futures markets, prices and transactions. 

Markets & Products – Derivatives

What are derivatives? What are these financial instruments used for? By whom are these tools applied?

Markets & Products – Forwards versus Futures

What is a forward or futures contract? What are the differential between those? Contract specs.

Markets & Products – Contract for difference

What is a CFD? What are CFDs used for? Where can the instruments be traded? How are these settled?

Markets & Products – Swaps

What is a swap? What types of swaps are available? What is their purpose? How are swaps settled?

Markets & Products – Options

What is a call or put option? How can these tools be applied? How does pricing of options take place?

Trading platforms – OTC markets & trading

How can OTC market be characterized? How is OTC trading organized? What are master agreements?

Trading platforms – Brokerage services

What is the role of a broker? What are the differentials between inter-dealer brokers and broker-dealers?

Trading platforms – Exchange trading

What features does exchange trading have? How is it organized? What fees are in place for members?

Trading platforms – Trading screens & platforms

What details are relevant to traders? What is Trayport, how does it work and why do traders use it?

Pricing, price drivers & indexation

How do prices arise in the market? What factors drive prices? What is an index? What is it used for?

FX markets & trading

Forex exposures of companies; the role of the treasury department; currency pairs; exchange rates.

Accounting – Mark-to-Market

Bookkeeping; accounting rules; the differences & consequences of M-to-M vs. historical cost accounting.

Accounting – Book structure & Internal transfers

How do firms organize in-house trading, between trade and other business units? Why? At what price? 

Terminology – Upstream, midstream & downstream

Explanation of the terminology which is related to the value chain.

Terminology – Opening & Closing, Long & Short, Bull & Bear

What do the concepts of long or short imply? Likewise for bullish or bearish, or opening or closing.

Exam & Certification

Entrima has trained numerous professionals and certified thousands of learners, and counting

The in-company training services were very satisfying, amongst others, as they served the purpose of learning by debate and through exchange of thoughts.

Pieter Schuurs
Intercontinental Exchange | ICE Endex

The most positive element of ENTRIMA’s online learning services concerns the progressive (step-by-step) approach from simple to more complex concepts.

Ronan Haas
Eurelectric

The online learning services are based on a comprehensive curriculum with a wide variety of theoretical basics combined with a profound business knowledge. The courses provide an in-depth understanding of business relevant processes.

Mario Claeys
Uniper Global Commodities

ENTRIMA’s courses are very suitable for our employees; good quality content is what we look for.

Rob Veersma
Advisor | Global Energy Community

Really well structured and easy to follow content that is varied in delivery in order to keep the reader engaged. Looking forward to seeing more from the ENTRIMA in the future!

Erika Rabadia
Manager Trading Surveillance | Shell

The course provided a good explanation.

Mohammed Abi Afthab Olikathodi
Analyst Energy Data & Scenarios at Eurelectric

Content was good.

Maria Kramer
Operational Risk Management at Statkraft

Good illustrations

Nataly Trofimova
Head of Internal Audit at D.Trading

The most positive element of the course were the short informative lectures.

Olga Lysytsyna
Senior Consultant at E-Star

It is very informative and well described. The subtitles help.

Mohammed Abi Afthab Olikathodi
Analyst Energy Data & Scenarios at Eurelectric

ENTRIMA’s Learning Platform provides access to a rich variety of courses which is really valuable for a life-long learner. You can access the content anytime and very easily, using your time wisely to study and grow.

Onest-Dan Gheorghisor
Sr. Expert Energy Trading & Risk Management B2B & B2C Sales OVM Petrom