Commodity Price Risk

Variance is an independent provider of commodity price risk hedging advisory services. After assessing the clientÔÇÖs risks, objectives and constraints, we help identify the various tools that address the risks: forward contracts, futures, vanilla options, or other structured solutions.

Clients partner with us to address a commodity and energy price risks. Examples include the following:

  • Steel manufacturer hedging nickel purchase prices
  • Company from the textile industry hedging cotton prices
  • Airliner hedging kerosene purchase prices
  • A power generation company hedging power-to-natural gas spark spread

Once a particular hedging strategy has been selected, Variance will work to put the documentation in place and efficiently execute each transaction, whether through competitive auction or negotiation with a single financial counterpart.

Variance accompanies the client along all the steps involved in the process. Variance produces all reporting for a proper follow-up and assists the client in dealing with all accounting issues that arise from the transactions.