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Description of Energy Risk

This book provides innovative, proven strategies for skillfully trading energy markets. The energy market uses tools and models that are unique and different from those required for traditional financial markets. With the increasing deregulation of the electricity market, energy is on the brink of becoming the hot opportunity for traders, power marketers, and managers worldwide. "Energy Risk: Valuing and Managing Energy Derivatives" provides not only an expert overview of energy trading but also the philosophies and strategies necessary for trading and managing risk in this exciting new arena of finance and investing. Dragana Pilipovic, a Harvard-trained physicist now consulting and designing software in the energy markets, has written the first book to discuss the intricacies and mechanics of energy markets.This groundbreaking book provides practical answers on how best to get a foothold in this emerging market.
You'll also find: in-depth explanations of the primary factors that influence energy risk, such as spot price behavior, volatility, and the forward price curve; introduction and detailed discussion of the fundamental price drivers of energy markets including electricity, natural gas, and heating and crude oil; and, specific ways in which risk managers can use tools introduced throughout the book to achieve their companies' risk/return goals.The growth in volume for NYMEX and IPE energy contracts is the only proof you need of the enormous potential in trading and energy markets! Dragana Pilipovic's "Energy Risk", with unique trading models for managing risk in energy and commodity trading, contains over 175 charts and graphs that illustrate key features of the market including a wide variety of equations, correlations, and methodologies. Its primarily quantitative approach and well-supported conclusions make it the ideal single-source, desktop manual for getting reasonable answers to actual modeling and implementation problems surfacing in today's complex and exciting energy markets.

Title Information

ISBN:

9780786312313

Pages:

248 pages

Format:

Hardback

Product Code:

9848

Publisher:

McGraw-Hill Professional

Published:

01/01/1998

Edition:

1st Edition

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About Dragana Pilipovic

As the electricity, natural gas, and other energy markets continue to grow in trading volume and importance, investment professionals must know NOW how to properly assess and evaluate problems and opportunities unique to this complex yet vibrant market. Energy Risk: Valuing and Managing Energy Derivatives is the market tested and immediately valuable answer to the many trading and risk management questions that traders, utilities, power marketers, natural gas firms, large end users, and the professionals who help them face in the often-untested waters of energy investment, trading, and risk management . Noted researcher and energy markets innovator Dragana Pilipovic uses her unmatched experience and education, and uniquely valuable insights, to provide an analysis of market behavior that encompasses both fundamental and quantitative analysis. She shows how to establish a modeling process that involves the key players managers, traders, quantitative analysts, and engineers and provides practical answers to energy trading and risk management issues. While its comprehensive overview of energy investing and risk management alone make Energy Risk required reading for today's cutting-edge professional, it is the book's detailed analyses and equations, and its presentation of progressively technical information, that make it one of the most complete and valuable manuals available for any market. Energy Risk sets the standard for new market introductory manuals, and will be the standard energy market reference for many years to come.

Contents of Energy Risk

1. What Makes Energies Different?
2. Modeling Principles and Market Behavior
3. Essential Statistical Tools
4. Spot Price Behavior
5. The Forward Price Curve
6. Volatilities
7. Overview of Option Pricing for Energies
8. Option Valuation
9. Measuring Risk
10.Portfolio Analysis
11. Risk Management Policies

Appendix A: Mathematical and Statistical Notes
Appendix B: Models from Interest Rate and Bond Markets
Glossary of Energy Risk M management