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A. PnL Explained

B. CTRM Software

C. Statistics

 

 

CRTM Software - Main Page

 

Overview

Resources related to CTRM, which is Commodities Trading and Risk Management software.  This also includes ‘ETRM’.  While the ‘E’ stands for Energy, as a practical matter, the two terms are used interchangeably to refer to systems that work with Energy, e.g. Natural Gas, Crude Oil and Power, Metals, e.g., Gold and Silver, and Softs/Agriculture items like Coffee and Cocoa.

 

Quick Links

See below the Quick Links section for descriptions for each of the links.

 

1) CTRM Software – General Topics

1.1) Introduction to CTRM

1.2) How to Think Like a CTRM Vendor

1.3) CTRM Ecosystem

1.4) CTRM Jigsaw Puzzle Metaphor

1.5) CTRM Professionals LinkedIn Group

1.6) CTRM System Design Philosophy

1.7) CTRM System Switching Strategies

 

2) CTRM Software – Vendor Risk

2.1) Vendor Risk Management

2.2) Vendor Risk Mitigation

2.3) Vendor Risk Audit and Audit-assist Checklist

 

3) CTRM Software – Design Considerations for Specific Functionality

3.1) Broker Fees

3.2) Initial and Variation Margin for Futures

3.3) Interbook Trades

3.4) Trade Payment Calculation Formulas

3.5) Applying Settlement Prices

3.6) VaR ‘Value-at-Risk’

 

4) Trade Information

4.1) CTRM Trade Type Taxonomy

4.2) Trade Lifecycle

 

5) Commodity Overview

5.1) Big 3 Energy Commodities

5.2) Precious Metals

5.3) Base Metals  

5.4) Softs/Ags/Dairy

 

 

1) CTRM Software – General Topics

 

1.1) Introduction to CTRM

Click the below link for a great introduction to CTRM software. 

 

Link: Introduction to CTRM Software

 

1.2) How to Think Like a CTRM Vendor

Better understand CTRM software by considering things from the point of view of a typical CTRM Vendor.

 

Link: Think Like a CTRM Vendor

 

1.3) CTRM Ecosystem

Commentary on where things are at now and where they are likely heading in the future for the Ecosystem of CTRM functionality.

 

Link: CTRM Ecosystem

 

1.4) CTRM Jigsaw Puzzle Metaphor

This page introduces a model of a CTRM based on a jigsaw puzzle metaphor.

 

Link: CTRM Jigsaw Puzzle Metaphor

 

1.5) CTRM Professionals LinkedIn Group

The link below takes you to a page on the PnL Explained Professionals website describing the CTRM Professionals Group.  From there, you’ll find a link to the LinkedIn homepage for the group.

 

Link: CTRM Professionals

 

1.6) CTRM System Design Philosophy

Provides some Design Philosophy suggestion for CTRM system designers and builders.

 

Link: CTRM System Design Philosophy

 

1.7) Strategies for Switching CTRM systems

Strategies and considerations for migrating from one Vendor system to another or for switching from a vendor-supplied system to a home-grown solution or vice-versa. 

 

Link:  CTRM Switching Strategies  

 

2) CTRM Software – Vendor Risk

 

2.1) Vendor Risk Management

Provides an introduction to Vendor Risk Management in the context of CTRM Software, including observations and considerations on how the rise of Big CTRM impacted the Vendor Risk profile of impacted firms.

 

Link: Vendor Risk Management

 

2.2) Vendor Risk Mitigation

Provides things that firms can to do reduce their vendor risk and, more importantly, things that also reduce TCO (total cost of ownership) and/or increase value in other ways. 

 

Link: Vendor Risk Mitigation

 

2.3) Vendor Risk Audit and Audit-assist Checklist

Click on the link below for recommended practices for a firm using a Big CTRM system around the concept of a ‘Vendor Risk Audit’ and provides a useful checklist to help with the process.

 

Link: Vendor Risk Audit and Audit-assist Checklist

 

3) CTRM Software - Design Considerations for Specific Functionality

 

3.1) Broker Fees

CTRM Design Considerations around Broker Fees

 

Link: Broker Fees

 

3.2) Initial and Variation Margin for Futures

CTRM Design Considerations around Initial and Variation Margin for Futures

 

Link: Initial And Variation Margin for Futures

 

3.3) Interbook Trades

CTRM Design Considerations around Interbook Trades

 

Link: Interbook Trades

 

3.4) Trade Payment Calculation Formulas

CTRM Design Considerations around Trade Payment Calculation Formulas

 

Link: Trade Payment Calculation Formulas

 

3.5) Applying Settlement Prices

CTRM Design Considerations around Applying Settlement Prices onto Trades

 

Link: Applying Settlement Prices

 

3.6) Intro to VaR ‘Value-at-Risk’

This page provides readers with a high level introduction to Value-at-Risk, known as ‘VaR’. 

 

It also contains the best description and comparison of the three methodologies as used by the industry that you’ll ever read.  They go by the names of ‘parametric’, ‘historic’ and ‘Monte Carlo’. 

 

Link: Intro to VaR

 

4) Trade Information

 

4.1) CTRM Trade Type Taxonomy

Commentary on items that are considered ‘Trades’, i.e., tradition trades with counterparties or exchange-traded and things that are not trades like physical inventory, both of which are supported by CTRM systems.

 

Link: CTRM Trade Type Taxonomy

 

4.2) Trade Lifecycle

Information on what people term as the ‘Trade Lifecycle’.  This puts together, for better understanding, all of the various events and/or things that happen to a trade from beginning to end.

 

Link: Trade Lifecycle

 

 

5) Commodity Overview

 

5.1) Energy

Covers the Big 3 Energy Commodities, Crude Oil/Refined Products, Natural Gas and Power (a.k.a., Electricity)

 

Link: Big 3 Energy Commodities

 

5.2) Precious Metals

Introduces Precious Metals like Gold and Silver, in the context of CTRM design

 

Link:  Precious Metals

 

5.3) Base Metals

Introduces Base Metals like Copper and Aluminum, in the context of CTRM design

 

Link:  Base Metals

 

5.4) Softs/Ags/Dairy

Introduces Softs like Coffee, Agricultural Commodities like Wheat and Dairy

 

Link:  Softs/Ags/Dairy

 

 

 

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