Presentations text content in Electronic Trading and the Globalization of Grain Markets
Slide1
Electronic Trading and the Globalization of Grain Markets Prepared by: Charles WhitmanFounder and CEO, Infinium Capital Management
February 24, 2011
USDA’s 2011 Agricultural Outlook Forum
Today’s Strategies & Tomorrow’s Opportunities
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Intro“The revolutionary idea that defines the boundary between modern times and the past is the mastery of risk: the notion that the future is more than a whim of the gods and that men and women are not passive before nature…. By showing the world how to understand risk, measure it, and weight its consequences, they converted risk-taking into one of the prime catalysts that drives modern Western society”
Slide3Risk Management Risk Management Understanding = Major Business EdgeHedge Away RisksFocus On Core Competency
Slide4Benefits of Electronic TradingTransparencyAccess- 24 Hour MarketsIncreased Volume & LiquidityTighter Bid/Ask SpreadsFaster Product AdoptionInstant Reporting & Risk Management
Slide5Slide6Slide7Accessibility Due to Electronification
Slide8Global Ag ExchangesAfrica South African Futures ExchangeAsia Agricultural Fut
Ex of ThailandBursa MalaysiaCentral Japan Commodity Ex.
Kansai Commodity Exchange
Korea Exchange
Singapore Exchange (was SIMEX)
Tokyo Grain Exchange
Australia
Australian Stock Exchange
Canada
ICE Futures Canada
China
Dalian Commodity Exchange
Zhengzhou Commodity Exchange
North America
Chicago Board of Trade
Chicago Mercantile Exchange
ICE Futures US Softs
Kansas City Board of Trade
Minneapolis Grain Exchange
New York Mercantile Exchange
India
Multi Commodity Ex. of India
National
Cmdty
&
Derivs
Exch.
Latin America
Bolsa
de
Mercadorias
e
Futuros
Mercado a
Termino
Buenos Aires
Rosario Futures Exchange
Europe
NYSE LIFFE - London
NYSE LIFFE - Paris
Russian Trading System
Turkish Derivatives Exchange
MFAO Olive Oil Exchange
Slide9Accessibility Due to Electronification
Slide10Accessibility Due to Electronification
Slide11ChallengesTechnology (Safe, Stable & Fair)Error PreventionScalability & BandwidthEqual Direct AccessFair Access to All Market ParticipantsDark PoolsWillingness to ChangeHesitant to push the buttonSome parties have a vested interest in holding on to the “old” way of trading
Slide12Risk HedgingGrain pricesEnergy pricesInterest ratesMargin HedgingBenefiting From Electronic Ag Markets
Slide13Benefiting From Electronic Ag MarketsStrategy ExamplesFuturesFutures SpreadCash/Future Swap – EFP (Exchange for Physical)OptionsRFQ (Request For Quote)Outright OptionsCSO (Calendar Spread Options)Inter-Commodity Spreads (and Spread Options)
Slide14Thank You600 W. Chicago AveSuite 300NChicago, IL 60654
Business Development
312-770-1912
www.inifiniumcm.com
Electronic Trading and the Globalization of Grain Markets
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