1) Can you describe the different types of Commodity Derivatives ?
2) What exchanges are Commodity Derivatives traded on ?
CME - Chicago Mercantile Exchange
CBOT - Chicago Board of Trade
NYMEX - New York Mercantile Exchange
BM&F - Brazil Mercantile and Futures Exchange
LCE - London Commodity Exchange
LME - London Metal Exchange
3) What are the different types of commodities ?
Energy - oil, gas, electricity, coal
Agricultural - grains, oilseeds, livestock
Metals - base, precious
4) How are commodities traded ?
Over The Counter
5) How do you price a commodity ?
6) What affects the price of a commodity ?
Supply and demand
Storage and Transportation
Natural Disasters and Conflict
7) What effect would an increase in interest rates have on the price of a commodity ?
8) What is a Commodity Forward ?
buy or sell a commodity (or commodity index) at an agreed price on a future date.
9) What is a Commodity Option ?
the right to (but not the obligation) to buy (or sell) a commodity (or commodity index) at an agreed price during a specified period.
10) What is a Commodity Swap ?
An agreement between two parties to exchange sequences of payments during a specified period, where at least one sequence of payments is tied to a commodity price or commodity index.
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