Part 1: Core Skills of Basis Trading
Gain an understanding of the fundamental concepts and practices of basis trading.
- Learn how a basis trading operation makes its money.
- Converse in the language of basis trading.
- Carry out basis transactions, including the execution of buy basis, sell basis and spreading activities.
- Do proper and accurate basis calculations.
- Identify basis patterns and evaluate basis risk.
- Aid in the administration and execution of long-the-basis positions.
- Aid in the administration and execution of short-the-basis positions.
Part 2: Basis Trading Administration
Develop a working knowledge of the proper procedures and routines involved in the execution and administration of a grain company’s daily basis trading activities.
- Identify and evaluate the company’s price risk position.
- Execute appropriate futures transactions based on company hedging policies.
- Reconcile statements of cash and futures positions.
- Calculate financial requirements and needs of cash and futures positions.
- Identify and evaluate the company’s basis risk position.
- Gain an understanding and appreciation for real world grain merchandising.