March 20, 2023

Trading is decision-making
Trading is an activity whereby orders are executed; it involves buying and selling. A trader is the person who negotiates and/or submits orders to transact. Hence, a trader closes deals. Trading concerns decision-making in the sense that each buying or selling transaction starts with analysis and ends with a decision. Each decision-making process ends up… View Article
January 16, 2023

Trading mandates & limit structures
To control a trading function, it is important to allocate mandates to the business and its professionals. In other words, to manage traders, organisations provide them with authorisation. Next, firms govern their employees by the implementation of limit structures. A mandate concerns an official order or commission to do something; it is the authority to… View Article
December 19, 2022

Mark-to-market valuation vs. fair value accounting
Companies and their business, control and support functions require price information in order to start certain periodic procedures and to generate various reports. The most reliable ingredients may be up-to-date prices, not historical costs. Valuating a position mark-to-market concerns accounting against actual market prices. Hence, it must be updated over-and-over. However, when products are hardly… View Article
November 28, 2022

Markets are complex social systems
People love certainty and they care for security but, usually, they do not get it. Individuals may be promised these aspects, and/or they may be convinced to have it, but it has actually only been assumed.
May 18, 2022

Option Spreads – Bull & Bear
Analogous to a futures spread, an option spread consists of two legs. Each leg concerns an option.
April 23, 2022

OTC Deal-making
Over-the-counter markets are characterised by a variety of aspects, activities and processes. This includes flexibility concerning the terms and conditions in the negotiation process, choice of preferred broker, discretion with order execution and counterparty risk management.
March 14, 2022

Model-based Strategies
Statistical arbitrage (or StatArb) can be seen as a model-based investment (or speculation) process, by constructing simultaneously long and short positions of different assets
February 17, 2022

Pair Trading & StatArb
Price-wise assets can be related to each other. This applies to financial assets, such as corporate shares or bonds, but also to physical assets, like commodities. Agricultural commodities are, for instance, related to energy for a variety of reasons.
January 23, 2022

The Weather Markets
Weather conditions affect all sorts of things. It impacts what people do, how human beings dress, where we go and what we consume. The weather also impacts the business.
December 14, 2021

Weather & The Global Financial System
It is undeniable that firms’ and investors’ understanding of the financial consequences associated with climate change will strengthen.
October 26, 2021

Weather Risk – Climate Change
Climate and weather are different concepts, but relate to each other. Different kinds of climate bring along different weather patterns.
October 7, 2021

Characteristics Of OTC Markets
Over-the-counter markets are characterised by a variety of aspects, activities and processes.
September 12, 2021

Bilateral Deals
Large commodity consumers typically contract their supplies directly at the source. They enter into bilateral agreements with producers.
July 6, 2021

Freight Rates
The price for shipping cargo is called the ‘freight rate’. Hence, the tariff at which a vessel is chartered is referred to as the so-called freight rate.
May 26, 2021

Freight indices – The Baltic Exchange
The Baltic Exchange develops and maintains various indices for freight.
April 14, 2021

Freight – Incoterms
International Commercial Terms (in brief:  ‘Incoterms’) are a series of pre-defined commercial terms published by the International Chamber of Commerce relating to international commercial law.
March 1, 2021

Metal markets & trading
In the metal markets, physical players come together to enter into supply contracts.
February 15, 2021

The Earth is actually one great collection of commodities, but, because of excessive use, supply of raw materials may run out one day.
February 8, 2021

Agro derivatives markets
Next to supply contracts, market participants enter into derivatives contracts.
February 1, 2021

Agricultural commodities
A soft commodity is a product that can be grown, while a hard commodity concerns a natural resource which is mined.
September 2, 2020

Price volatility
If prices would not move, there would be no price risk. In markets where the price level is regulated and, consequently, fixed for the remainder of the year, price volatility does not exist.
August 19, 2020

Radical uncertainty
Risk is not a synonym for uncertainty, because risk can be quantified, whereas uncertainty cannot. Risk quantification is based on a formula including ‘probability’ and ‘effect’.
August 5, 2020

Open interest
The moment a futures contract, an option contract or a swap agreement is entered into by buyer and seller, a position is opened.
July 22, 2020

Exchange of futures for physicals
An exchange of futures for physicals (EFP) is a transaction process allowed by an exchange to enable market participants to manage their market risk with direct reference to the price of an underlying physical transaction.
July 8, 2020

In the commodity business, settlement is one of the main processes in deal-making. Settlement is the actual process that provides the final completion of a transaction; the unwinding of the transaction.
June 24, 2020

In order to guarantee the duties of a clearing house, market participants need to arrange for a guarantee for each position, for instance, being commodity (derivatives) contract.
June 10, 2020

In the field of trading operations, clearing of transactions is a very important process. Clearing is often considered guaranteeing the settlement of a contract between two parties, like a form of insurance.
May 27, 2020

Counterparty risk & credit support
Counterparty risk consists of delivery risk for the buyer and credit risk for the seller. These risks have to be managed by those parties who are involved with it.
May 13, 2020

Trade & risk management solutions
Commodity trading can be considered a business function. As with any business, it has to be checked and verified by control functions and it has to be given assistance by support functions.
April 29, 2020

Trade Operations
Typical commodity & energy trade operations are quite diverse.
Our Labels
Entrima and Market Abuse Centre (MAC) are the two labels we operate to provide learning services for professionals in the commodity & energy markets.

Content & Context

Entrima’s mission is to transfer knowledge regarding the business, controls & operations of parties in (or relating to) the wholesale markets.

Conduct & Culture

MAC’s mission is to facilitate the prevention & detection of misconduct and to foster proper behaviour in organisations. This is achieved via training, periodic updates and increased awareness.