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Our courses are intended for a global audience, with each one being completely customisable to suit the needs of the individuals it is being delivered to.

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Energy and Commodity Markets

  • Banking and Financial Markets, Derivatives, Energy and Commodity Markets
  • Duration: One day
  • Information

    This One-Day programme is a highly participative programme on the products, techniques and practices used in the Energy and Commodity markets. The course will include discussion on the causes and consequences of recent upheavals in energy markets.


    Session 1:

    Comparison with Traditional Asset Classes

    This section highlights the key differences between traditional asset classes (such as fixed income and equities) and the energy markets.

    • Differences between energy markets and traditional financial markets

    • Exchanges and Indices

    • Overview of different markets: Oil, Natural Gas, Electricity, Emissions, Freight, Coal

    • Formula based pricing

    • The way the market quotes

    • Case study: Implications for Volatility

    • Case study: Arbitrage limits

    Session 2:


    This section gives an overview of the key instruments used on the market.

    • Forwards, Futures, Swaps

    • Asian options, Swaptions, Spread options, Basket Options

    • Case study: Basis Risk

    Session 3:

    Specific Energy Markets

    • Natural Gas

    • Emissions

    • Oil and Products

    • Power/Weather

    • Case Study: Calculate the theoretical price of CO2

    Session 4:

    Current Market and Long Term Outlook

    • Review Drivers

    • Published Regular Statistics

    • Macro picture

    • Looking forward

    • Will the Bull Market Continue?

    Session 5:

    Structure of Forward Curves

    This section discusses the main drivers of energy prices, and the difference between spot and forward markets, and shape of the curve.

    • Spot Price Behaviour (Mean reversion, Seasonality and jump diffusion)

    • Main price drivers

    • Shape of the forward curve and relationship with spot prices

    • Case study: How should we interpret the current bull run?

    Session 6:

    Volatility and Correlation

    This section will look at the importance of spreads in energy trading and hedging, and how things can go wrong.

    • Volatility

    • Term structure

    • Seasonality

    • Case study: What happened at Amaranth

    • Correlation

    • Term structure

    • Importance of Spreads

    • Understanding and exploiting correlations

    • Effect of stock on volatility

    • Smile and inverse leverage

    Session 7:

    Other Commodity Markets

    • Other energy related: Freight, Coal, Weather, Plastics

    • Metals: Industrial and Precious

    • Agriculture

    • Livestock

    Session 8:

    Commodities Indices:

    • Correlation between commodities and traditional asset classes

    • The main commodity indices

    • Construction of indices

    Session 9:

    Structured Products

    This section will look at how the energy indices can be packaged to appeal to investors.

    • Creation on commodity linked instruments

    • Case study: Construction of oil-linked note

    Course Close

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    As every course we run is tailored to meet the specific needs of each client, we can only provide an estimate after fully understanding your specific requirements. Please complete the form below of call +44 (0) 208 894 4977 to discuss how Taylor Associates can help you.

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