Understand mechanics of commodities trading

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Commodities lay a basis for a global economy. Therefore it does not come as a surprise that the commodities market is extensively discussed and analyzed in the mainstream economic titles. Supply chain disruptions, divagations on national security in the context of an access to the key materials for defense and technology sectors, frequently come up on front pages of opinion making medias.

It is pitiful however that the very mechanism of commodities trading, the underlying process of trade negotiations, financing, transportation and risk management is so little understood, by a vast number of experts and analysts who comment on the situation on the markets and who find an attentive audience among decision makers and a wider public.

Many myths and misconceptions are being born as a consequence.

Mission of Commodity Academy, is to play a humble part in bringing more light to the understanding of mechanics fueling the global trade in commodities.

Training is based on 3 modules:

Market Analysis – showing, based on case studies, how physical commodities traders and brokers navigate the landscape on the daily basis looking for arbitrage (profit opportunities) on the markets characterized by high volatility, low margins and likelihood of governments interference.

Trading – discussing trade negotiations. In commodities typical daily transactions are of very high value. Sheer volume of commodities needed to be moved between producers and end-consumers and all the intermediaries in between makes them so. Hence the deals for millions of dollars are being made by the phone and email, between counter parties that never saw each other. Traders and brokers use their words carefully, using terms that are not understood by individuals without prior training, but that guarantee efficiency and diminish the room for mistakes.

We explain step by step how the deals are negotiated and discuss typical terms, conditions and clauses used on the market.

Execution – perhaps the most complex and interesting part. Discussing different modes of transportation with a focus on marine vessels and barges, which are the most cost-efficient modes of moving commodities. Physical trading does not take place in vacuum. In fact, logistics makes a deal possible or kills it. Changing freight rates can open up completely new opportunities for traders, on the markets that they have not considered as viable in the past. We show you on real life examples how the deals are financed and how risks are managed, along with explaining the necessary paper trail (documents) behind it.

During the course we try to get you as close to real trading as it is only possible. We replicate the workflows of actual deals taking place on the market. There is nothing “academic” about the courses offered by Commodities Academy. We aim to present you with a material which is as practical and hands on, as possible in a classroom or distance learning environment.

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