Commodity Options

This is a two-day course for which no existing knowledge of Options is required. The course moves from options basics to advanced concepts such as delta hedging and the Greeks. Real-world examples and real-world trading tools (e.g. option pricing model) are used throughout the course.


Course Information

Price £1600.0 + VAT
Duration 2 days
Location London
Available Dates
2018-03-01 00:00:00.0  Register Now
2018-06-07 00:00:00.0  Register Now
2018-09-27 00:00:00.0  Register Now
2018-11-29 00:00:00.0  Register Now

Who Should Attend

  • Personnel from the commodity market, trading companies and other individuals who wish to gain an understanding of commodity options and their uses
  • Risk management and financial departments of commodity producer and commodity trading companies
  • Commodity supply and distribution companies
  • Major commodity consuming businesses
  • Trading companies, banks, brokers, government, regulators and associated organisations

Booking Information

Tel: +44 (0) 20 7065 7706

Course Content

DAY 1

  • Option basics; calls and puts
  • Everyday examples of calls and puts
  • Definitions of calls and puts
  • Option contract specifications
  • Particular features of commodity options
  • Exercise and assignment
  • European/American-style options
  • Options evolution
  • Using options; hedging and speculation
  • Hedging with futures vs hedging with options (outright and collar/fence)
  • Speculating with options; exact tailoring
  • Option price and value; intrinsic and time value
  • Put/call parity
  • Moneyness; at/in/out of the money
  • Pricing options; underlying, time, interest rates, volatility
  • Volatility; definition, types and uses
  • Demonstration of an option pricing model

DAY 2

  • Volatility skew
  • Basic option strategy
  • Pay-off graphs
  • Option strategy; the collar/fence revisited
  • Option spreads; call/put spreads, straddles/strangles, flies/condors, etc.
  • The option sensitivities (Greeks); delta
  • Option market makers
  • Delta hedging
  • Delta neutrality and synthetics
  • The option sensitivities; theta, rho and vega
  • Gamma; definition and trading gamma (long and short)
  • Option resources and glossary (in manual)
  • Q&A session