Risk management

Margin notes

Brett Humphreys explains how to measure and manage margin risk, an often-overlooked – yet often-significant – risk exposure

Opportunity knocks for smelters

Aluminium manufacturers have long used sophisticated hedging and risk management techniques to protect against fluctuating metal prices, yet they have only recently looked at transferring these skills to power risk management. David Wilson reports

Explaining big events

The expression ‘this month’s once-in-a-million event’ has become a cliché in finance. From the sudden bankruptcy of investment-grade companies to 5% daily moves in foreign exchange markets, we’ve seen them all. Rare events – which for practitioners mean …

Exchanging blows

Conflict in the US and growth in Europe marked another turbulent year for energy exchanges. Kevin Foster casts an eye back over 2002

Enough’s enough

Brett Humphreys takes the guesswork out of determining how many simulations are needed to calculate value-at-risk

Blurring the lines

A turf war between Atlanta’s IntercontinentalExchange and the New York Mercantile Exchange reveals a shift in the traditional role of over-the-counter brokers and exchanges, finds Catherine Lacoursière

Getting stressed

To understand how much value can be lost from a position in the energy markets, we need to use measures other than value-at-risk. Brett Humphreys discusses methods for creating effective stress tests

Cell mates

Traders love spreadsheets. But complex deals can quickly outgrow a sheet developed on the fly. Since traders won’t abandon their favourite tools, Stuart Cook and Tony Hughes of The Structure Group look at how firms can control their use

How much can you take?

Given recent events, energy firms need to fundamentally re-think how they estimate their risk tolerance. Maria Kielmas asks what has prompted this soul-searching