Introduction to Commodities Markets

September 24, 2012

Many classes sell out; we suggest registering at least one week in advance to ensure availability.

Intermediate Level, 7 CPE Credits

Instructor: Charles Gates

Hours: 9:00 am — 5:00 pm; Registration/Breakfast begins at 8:30 am

Location: New York City, Bayard’s, One Hanover Square

Driven by demand from the emerging markets and speculation by traders and investors, volatility in the commodities markets is rampant. As many prognosticators see inflation on the horizon, gold and silver are in the crosshairs of many speculators. This hands-on course examines the factors impacting the prices of commodities, their features and characteristics, pricing and risks.

By the end of the course, the participants will be able to:

• Identify the various types of commodities with primary focus on energy and metals
• Describe the features and characteristics of commodities
• Differentiate between spot, forward and futures trading
• Explain and calculate pricing
• Compare and contrast investing and trading commodities

• Identify the risks associated with commodities

Session 1: Introduction to Commodity Markets

By the end of the session the course participant will be able to:

• Identify major commodity groups and markets
• Identify participants
• Differentiate between spot, forwards and futures markets
• Discuss characteristics of delivery methods
• Explain why commodities are different than financial contracts
• Define fungibility
• Discuss liquidity of commodity markets
• Describe why gold plays a special role in world markets

Session 2: Pricing Commodities

By the end of the session the course participant will be able to:

• Identify components of the forward price
• Calculate a forward price
• Define forward curves
• Define backwardation and contango
• Identify reasons for backwardation and contango
• Analyze prices from different commodities
• Discuss economic and political variables impacting prices
• Describe commodity benchmarks

Session 3: Speculating, Hedging and Investing

• Recognize exposure can range from short to long term
• Identify and hedge corporate risk exposures
• Describe the different products used to hedge

• Forwards
• Futures
• Swaps
• Options

Session 4: Identify the Risks and Risk Measurements Used in Commodities