Category Archives: Market Risk

: From Shipping to Agriculturals and Energy

Bon Voyage Gunvor.

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“While there have been margin calls associated with the European natural gas price rally, Gunvor maintains a healthy liquidity position and instruments to manage any further volatility,”
– Gunvor Spokesman

To the contrary our sources indicate that Gunvor Group trading activity is effectively frozen with its remaining gun powder serving to manage its decay.

The bonuses in arrears won’t be paid.

Gunvor is getting flushed. The market has a job to perform but is not done yet. For us as an analyst it is has explained the extreme-volatility in the TTF gas market.
The trader’s future is purely and simply in the hand of Goldman Sachs, Citi and the long swap dealers at TTF. Continue reading →

Cargill: A Glimpse into the History of Hedging

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The most recent accounts of “hedging” occurred in the mid-1800s, even though there is historical evidence that attempts to “hedge” happened well before. In the mid-1800s, Chicago became a commercial center of industry, a focal point where people from across the Midwest came together from a network of rail lines. Farmers were selling grain to buyers who would then ship their grain all over the U.S.

Farmers would produce grain during the spring and summer, and come to the center of trade (Chicago) at the end of the summer to sell it. More often than not, a number of dealers would then offer a price to secure those purchases for a limited amount of grain.

Continue reading →