Course Preview : Introduction to Commodity Markets at NYU

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I'd like to give you some idea of what this course will be about and what you can expect from this course over several next weeks. We will have several models and the last model will be devoted to the final project of working on specific commodity derivatives, but it's not only about the final project. Throughout this course, you will have activities and assessments which will allow you to practice the key concept in everything you learn in this course.

In general, what I'd like to tell you is that this experience is really about introducing you all to energy markets. It can be your very first course, you might already work in this field, which still this course can be helpful for you and will give you some technical, useful, practical tools.

In order to accomplish these objectives, we will start with a macro perspective. We will go through the main markets in the main structures. We will perform a statistical study of commodity data prices and we will look in detail at the dynamic of commodity prices. We will go through the calibration of the models, which is a very important aspect of any practical building of models in commodity space and will be quite important to you in your work.

But first of all, I would like this to make sense. I would like to go through the history and the key concept of commodity trading. I'd like to talk about energy measuring, and how to measure energy because sometimes we forget where it's coming from, we will go through aspects of analyzing of core commodity data, and our main goal is to look at the valuation of commonly traded instruments in energy markets.

I hope to teach you how to analyze and deal with correlations within commodities, which is my particular area of expertise, and specifically for commodity derivatives we will look in very detail at swaption and spread options. We'll also look at the calculation of the Greeks and that's actually will be your core activity in the final project. To accomplish these goals, we will have to analyze data because that's a very key element in any activity.

In our activities, we'll mostly use Excel as well as a programming language, Python, or any other language you would like to use, this is up to you. Programming to me is just a tool that is necessary to solve a particular problem. It's very important, of course, to be able to write problems efficiently and use them in your work. Please keep in mind that this program includes 24-hour support for technical issues and they will be experienced very good learning facilitators, which will help you to figure out any inquiries or questions on the course. All these resources are available for you, for your benefit, so please take advantage of them should you need any help. I hope you are ready to go, so let's get started. Let's start our commodity course.