Commodity Risk Management and Price Risk– Using Agiblocks to Hedge Your Bets

Traders, sellers and buyers of commodities tend to focus on the Commodity Trade- or CT-part of CTRM solutions. That seems obvious enough, as Commodity Trade more astutely describes the day-to-day, whereas RM or Risk Management is just a part of that. Lest we forget that RM is in actuality 50 percent of the full abbreviation, we will now talk Risk Management. Or, more precisely, commodity market risk in general, price risk in particular, and of course how it all relates to Agiboo and our flagship CTRM software for soft and agricultural commodities, Agiblocks. As with every investment in every sector, there are risks involved when trading commodities, even when it’s your actual business and not a portfolio strategy. It’s easy to picture these risks when talking about mining and minerals like gold, steel and coal, or when discussing energy sectors like oil, gas and electricity. The agricultural sector too has its fair share of market risks though, whether it be in sectors like wheat, cotton and sugar, or related to coffee and cocoa beans. Luckily, risk can be managed – to a degree. Commodity Risk Management Commodity Risk is defined as any risk an entrepreneur faces due to changes in… continue reading

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Source: CTRM Center

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