We continue our Hedging 401 series with a post explaining more hedging "lingo." The terms contango and backwardation may seem odd, but they give us more information about what is happening in a market and, thus, how we can best use spreads.
Over the past two years, the Westlark Team created three blog series about “hedging,” with the goal of helping people better understand what financial hedging is and how it can be used to benefit your business. We want to continue this trend with our new series, Hedging 401. In this series, we will explore the concept of spreads – what they are, what they mean, and how they are used in the marketplace.
Financial options are versatile tools to have in your supply portfolio toolkit. As we wrap up our Hedging 301 series, we would like to look at two more strategies for using financial options.
Understanding how a tool works is the best way to make sure we get the most out of it. This post examines how a fuel distributor might use the building blocks of financial options to protect against fixed price risk and achieve their desired margin.
All businesses face risk. Most businesses want choices about how to manage risk and achieve the outcome they desire. Financial options can be a part of managing risk. In this post, we want to look at the building blocks of financial options.
If reading about Greek derivatives and math jargon bores you- don’t worry. Many people feel the same way when the topic of financial options comes up. In Hedging 301, we want to explore what financial options are, how they can be used, and how your business can integrate them into your financial planning.
Spreads help "tell a commodity’s story" sharing important information about that commodity that can help a business assess their hedging risks.
In our first Hedging 201 post we looked at how the structure of a forward curve helps tell a commodity’s story. Now, we want to explore the role a spread plays in helping to interpret that story. What is a spread, and what do they do?
In Hedging 201 we would like to take things a little farther, exploring important topics like understanding market spreads and how using different financial tools can benefit your business. The first topic we will explore is – forward curve structure.
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Westlark Advisors has taken the burden of the everyday supply logistics off our plate and allowed us to focus on our operations in the critical times of the year. They have educated our team along the way and helped us brainstorm options/risks that fit our business model. Westlark Advisors has allowed the Tevis organization to explore opportunities within the supply and hedging arena that we would not have been exposed to without the relationship.
We experience less angst when making a futures purchase.*
They not only taught us how to plan and diversify our supply, but also new ways to protect the price. They have been great at negotiating supply deals and putting plans in place to know we will be secure when the market is not. I am confident that if things get tight we will be in a better position than our competitors.
We can’t say enough about the high level of service the entire team provided us. We relied on them and they came through for us over and over. They are complete professionals and a pleasure to do business with.
It has been one of the best decisions that our company has ever made. The Westlark Advisors team have looked after our interests since day one, and have executed the plan each year very well.
Westlark Advisors has partnered with energy firms since 1998 to provide transparent, value-driven commodity market advisory services.
