Target groups

• Any professional in the commodity or energy markets, including, but not limited to, employees of a company with a trading function, brokers, exchanges, clearing organisations and regulators.

Learning objectives

• To get an idea of the risks relating to trading.
• To know how these can be identified, assessed and controlled.
• To understand the implications of mitigating those risks
• Being able to point out the impact of one solution to another problem

Programme

• Market risk
  • Adverse price moves
  • Risk assessment
    • Risk qualification
    • Risk quantification
      • Value at risk
        • Methodologies
        • Relevant parameters
        • Interpretation of outcomes
      • Stress testing
    • Counterparty risk
      • The risk of non-delivery / non-supply – Delivery risk
      • The risk of non-payment – Credit risk
        • Clearing
          • Clearing houses
          • Clearing members
        • Collateralisation & margining
        • Initial margin
        • Variation margin
        • Defaults & the default waterfall
      • Liquidity risk
        • Market liquidity
          • The consequences of a poor price formation for consumers
          • The relation between price volatility and asset liquidity
          • Market depth & resilience
        • Finance liquidity
          • Funding
          • The level of the working capital impacts the market activity
        • The circle market risk – credit risk – liquidity risk
          • Balancing the ratios
          • Systemic risk
        • Compliance risk
          • Corporate culture
          • Sanctioning may involve the company and/or employees
            • Administrative sanctions
            • Criminal sanctions (incl. sentencing)
          • Naming & shaming hurts the reputation of the company – Reputational risk
          • Incorrect or incomplete reporting of data
          • Incorrect or incomplete publication of inside information – Unlawful disclosure
          • An non-effective trade surveillance function
        • Governance
          • Framework
          • Setup
            • Controls
              • Pre-trade controls
              • Trade controls
              • Post-trade controls
            • Limit structures
              • Risk limits
              • P/L limits
              • Volume limits
              • Price limits