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IMOS On-Prem - Commodity/Option Trade
Commodity/Option Trades are nonfreight derivatives that are traded as hedges to your company's overall exposure. These trades (for example, crude oil, iron ore, and coal) are meant to hedge risk to overall market fluctuations that may impact your commodity desk and in turn, impact the freight book. Commodity/Option Trades can be represented as buys/sells with a simple Quantity and Price. They reference market data for P&L and settlement in the exact same way as FFAs.
Commodity contracts are valued against the quoted forward rates for the route underlying the trade. Commodity Options are not being automatically valued against the underlying routes. Instead, you can create a Market for Commodity Options in which the Option Symbols can be quoted. Each Commodity Option contract will have a unique Option Symbol automatically generated. On the Market Data form, the quoted values of the trades can be recorded for each Option Symbol.
In the Trading module center , under Trades, click Commodity/Option Trade.
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Enter contract details. The grid on the bottom of the form populates with the Periods, the Market Rates, the Date that the Market Rate is from (Source), and the P&L (Exposure). When you first enter a trade, periods in the future appear on the Exposure tab. After a particular period of the trade has matured and the settlement rate has become available, that period moves to the Settlement tab. The Trade must be refreshed for the periods to appear on the correct tab. To refresh, close the trade and reopen it. These conditions both need to be fulfilled for this to happen: Monthly information appears on the Months tab. Note: Configuration flags CFGLinkedTradeTypes must be enabled. The grid at the top of the tab enables you to capture any paper trades that the contract is using to hedge. The Contracts grid enables you to capture any trades that are using this contract as a hedge. Example: If you have an FFA trade, and there is bunker exposure associated with the calculation that you would want to hedge, then you would use the top grid and select a Bunker Swap. If you have a Cargo contract that has freight exposure and you want to hedge to an FFA, then this Cargo contract would show up in the Contracts grid of that FFA. On either grid, you can:
Note: The Broker Confirmation Number is required to confirm a trade; it changes the Status to Confirmed. Someone with the Broker Confirmation Module Right selected in Security must enter the Broker Confirmation Number to confirm the trade and save it. Only paper trades that are confirmed can be settled for matured periods.Exposure Tab
Settlement Tab
Months Tab
Linked Trades Tab
Copying a Commodity
To copy a Commodity, click . Enter the number of copies and then click Create. Edit line items for the copies as needed and then click OK.
Commodity/Option Trade List
All Commodity/Option Trades appear on the Commodity/Option List. In the Trading module center , next to Commodity/Option, click List.
The Commodity/Option List is a standard IMOS list, so you can sort it, filter it, do a Quick Search, and create custom Views for it.
In the Commodity/Option List, you can select multiple Commodity/Options and confirm them at once by clicking the Confirm trade(s) link.
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