FEA

FEA’s Value-at-Risk solutions are used by some of the largest electricity, natural gas, and oil trading firms worldwide. The extensive instrument coverage provided by FEA’s VaRworks allows energy trading firms to model physical positions and a wide range of exotic derivatives such as spread and basket options and swing contracts.

VaRworks and MakeVC are used by one of the largest U.S. participants in marketing and trading physical and financial energy products, including natural gas, power, crude oil and associated commodities. This firm acts as a critical link in the marketplace between some of the world's top energy producers and retailers, and provides competitively priced natural gas and electricity to support the retail marketing efforts and activities of its sister companies. The firm uses FEA’s Component VaR technology to decompose firm-wide risk. It also has a sophisticated market and counterparty risk management structure in which VaR plays an essential role. Holding periods are specific to the types of positions being measured, and are determined based on the size of the position or portfolios, market liquidity, purpose and other factors. The addition of Stress Testing and Extreme Value Theory to VaRworks also allows the company to look more carefully at extreme potential risks.

Another large international energy trading firm implemented FEA’s VaRworks for their electricity and natural gas portfolio in just a few weeks. Credit rating agencies were demanding a system of risk measurement and control prior to the start of the trading function, including daily value or earnings at risk. FEA's VaRworks delivered immediate access to sophisticated financial engineering techniques. Our MakeVC software allowed them to create custom volatility and correlation datasets for energy risk management, including seasonality adjustments and constant maturity futures and returns. With the help of FEA’s experienced support specialists, the firm was able to integrate VaR into their risk management structure in record time.

In addition to VaRworks and MakeVC, other FEA products that may be of interest to energy companies are:

@ENERGY/Basics & Advanced
@ENERGY/Forward Curve
@ENERGY/Swing
@ENERGY/Weather
@ENERGY/Storage
StructureTool

Click on a product name for a detailed description and a list of features.

We would be happy to provide a personal demonstration of any product, or feel free to contact us to talk with one of our staff directly.

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