The CTRM Blog

It seems that many commodity traders, particularly those in the energy space, have held on to the belief that  Dodd-Frank would never take effect – Republicans would win in November and kill it or lobbying would be enough to weaken or dilute the rules enough that they would have not real teeth.

Amphora, Inc. announced this morning that they had acquired a gas and power trading system called “Affinity” from Societe Generale.  According to the press release, the system encompasses trading, scheduling and settlement of gas and power trades, credit and includes “advanced risk and reporting features.”

Amphora’s president, David Newton, is quoted in the press release as noting that the system has had “…years of development at Sempra, RBS and Societe Generale…”  Though not stated in the announcement, the Affinity system appears to be the result of an internal development effort at RBS Sempra, a company that was subsequently acquired by Societe Generale in January 2011.  Societe Generale shut down their physical trading operations in North America less than a year later.

By Patrick Reames, Managing Director – CommodityPoint

CommodityPoint, in our recent study Data Management Solutions, observes that the data management software category is one that has seen rapid growth in recent years, driven by the recognition that there are multiple and specialized issues in the commodity trading and risk management industry that have not yet been adequately addressed via traditional integration methods and tools. These issues include:

•  Management requiring access to results in a more timely manner
•  Greater need for sophisticated analysis capability to adapt to changing conditions
•  Increased focus on risk management both internally and externally

The CFTC issued an interim final rule on Wednesday of this week that is finally starting to illuminate one of the pressing questions faced by market participants – What qualifies as a swap and what does that mean to me?

When I was a very young lad, my mother used to tell me that if I got up out of bed at night, the Boogie Man that lived under that bed would grab me by the ankles and drag me down to the depths of hell and into his kitchen/dungeon, where I would be served to the Boogie family as dinner. Though the threat did cause some considerable emotional scarring, it was also a very effective tool at keeping me firmly planted in the rack – allowing her to get a bit more sleep, a rare luxury for a women raising 4 young kids. Later, as I got a bit older, I began to deduce that it was unlikely that some evil character was lurking under my bed. Subsequent daylight-aided searches confirmed that there was nothing under the lower bunk other than the occasional matchbox car or Lego piece, assorted bits of trash and whole lot of dust bunnies. Though the mental scars remained (slept with a nightlight on until I was well into my teens), my increasing knowledge of my environment meant that her “stay in bed” threats had to became more physically plausible.