Risk management
The ABC of PCA
Often, the costs associated with implementing advanced statistical models can outweigh the potential benefits. Brett Humphreys shows how to smooth and speed up choppy simulations using principal components analysis
Commodity kickers
Retail investors are showing greater interest in commodity-linked products. but most of the structures launched in Europe so far have been based on small, tailor-made baskets. By Patrick Fletcher
UK business paying £1bn/year too much for energy
UK businesses are failing to manage energy buying efficiently and as a result are exposed to volatile prices, losing up to £1 billion ($1.81 billion) a year, a new survey has found.
GlobalView technology to support ConfirmHub
US-based GlobalView Software has been chosen as the exclusive technology provider to ConfirmHub, a joint venture by brokers Icap, Amerex Energy and Prebon Energy. ConfirmHub is a post-execution, straight-through processing (STP) trade-confirmation…
Awards
Welcome to the annual Energy Risk awards, celebratingthe talent,innovation and enthusiasm that forms thebackbone of this industry.
Contract killers
Hidden risks can lurk in unexpected areas – such as the contracting process. Brett Humphreys and Brett Friedman discuss how risk managers must look beyondsimple value-at-risk measures and find other potentially hidden exposures
Buyer beware
Risk-management software development is still struggling to recover from slashed budgets after the Enron debacle. So before choosing a new system, buyers should look closely at five critical areas, writes Salim Jabbour
Slaying the dragon
In the first of a two-part series on hedging risk, NeilPalmer looks at the effectsof imperfect correlation on basis risk, and finds that unless you have a perfecthedge, you may just have to learn to live with risk
Counterparty risk
Eduardo Canabarro, Evan Picoult and TomWilde present a new approach to derivativescounterparty credit risk that can affect utilities using a onefactor conditionalindependence framework, deriving a formula for theratio of ‘expected positive exposure’ to…
The vendors’view
Energy software vendors are the first to admit they suffered financially fromthedownturn in the markets, but most stress they’ve developed innovative solutionsdespite the slump. Energy Risk put Salim Jabbour’s concerns to vendors
CCRO data hub update to follow Energy Risk USA conference
The US-based Committee of Chief Risk Officers (CCRO) will give a presentation in Houston next Wednesday, May 11, on the energy data hub it is developing. The session will follow the last presentation of the Energy Risk USA 2005 conference and will take…
All bases covered
In 1997, Norwegian energy firm Statoil implemented an enterprise-wide risk management system with the help of Goldman Sachs. Eight years on, few energy companies can rival its approach. Joe Marsh discovers why
Tentative steps
Algeria’s state-owned oil company Sonatrach is about to become the first oil and gas company within Opec to roll out an independent risk management programme to cover its crude oil and gas sales. Stella Farrington reports
Icap-Hyde hires Toyne to head tanker FFA broking
Icap-Hyde, a London-based joint forward freight and shipping derivatives-broking venture between broker Icap and shipping broker JE Hyde, has added to its team. Simon Toyne has joined as director of tanker forward freight agreements (FFAs), responsible…
An energetic debate
Enterprise-wide risk measurement and management, regulatory issues and pricing and hedging strategies were the hot topics this year at Energy Risk Europe in Amsterdam. James Ockenden and Joe Marsh report
Answers in the wind
Project valuation means making calculated assumptions that aren’t always accurate. Brett Humphreys discusses the assumptions that may be embedded within a valuation and how these assumptions can affect the final value
A solid foundation
MotherRock, the energy hedge fund set up by former Nymex president Bo Collins, recently chose Kiodex’s ASP-based risk management software. Joe Marsh explores the trade-off between web-based and installed systems
Hanging on at the top
This year’s User Choice Awards demonstrate that quality counts. In a fast-changing market, the top vendors and packages have managed to stay ahead of the pack. But the winners cannot rest easy. With IT budgets deflated, it’s a competitive market, and…
The sum of its parts
One can view a corporation’s individual projects as a portfolio of options – useful risk management tools to be used if their risk/return ratios are better than that of the firm as a whole. But how to work out the equity cost of capital at this…
Shopping for curves
More regulation requires more accurate valuation of forward trades – and a need for more reliability in the forward curve tool. Sandy Fielden presents an informal survey of the data choices available to energy risk managers in the US natural gas and…
A solid foundation
MotherRock, the energy hedge fund set up by former Nymex president Bo Collins, recently chose Kiodex’s ASP-based risk management software. Joe Marsh explores the trade-off between web-based and installed systems
Calgary’s oil patch
Some Canadian oil and gas producers got their fingers burnt last year as oil prices soared and hedging programmes resulted in big losses. What will their strategies be in 2005? Catherine Lacoursiere reports