A Look Forward— Understanding Forward Curves …

REPORT: RISKA look Forward Understanding ForwardCurves in energy Markets May 2012 Risk Data ServicesPLATTS SPECIAL REPORT: RISK | 2A look Forward Understanding Forward Curves in energy MarketsEXECUTIVE SUMMARYThe term Forward curve is a basic concept used freely by participants in energy markets. Despite the basic nature of the term itself, there is a wide divergence between companies in the definition and use of Forward Curves . This paper explores several types of Forward Curves used by market participants, differences between market-based Curves and settlement-derived Curves , and tools available to energy companies for modeling Forward prices. Forward Curves The term Forward curve refers to a series of sequential prices either for future delivery of an asset or expected future settlements of an index. If we consider the NYMEX natural gas markets we note market participants could enter into contracts to purchase natural gas deliveries in future months for fixed contract for June deliveries recently settled at $ , July deliveries settled at $ , August deliveries settled at $ , and so forth.

WWWPLATTSCOM SPECIAL REPORT: RISK A Look Forward— Understanding Forward Curves in Energy Markets May 2012 Risk Data Services

Loading..

Tags:

  Understanding, Energy, Forward, Look, Curves, Look forward understanding forward curves, Look forward understanding forward curves in energy

Information

Related search queries