MetalRiskManager.com : Online valuation and risk management toolkit for users of the LME

MetalRiskManager.com is a completely new concept in metals price risk management; we provide the user with latest LME valuations for all contracts.

We are totally independent and use the LME closing market data coupled with standard models for valuation and measurement of potential price risk.

There is no purchase or installation of any software.

Users can access our services conveniently, as and when they want, 24/7 either as pay per download or by monthly subscription.

We support all LME contracts, as well as those OTC and physical contracts which reference LME prices. (see contracts supported)

Currently, MetalRiskManager is limited to contracts traded on the LME, and some OTC contracts based on LME prices. This includes the following...

LME futures and options - All commodities and currencies supported on the LME

OTC forwards (prices are interpolated or extrapolated from LME prices)

Unpriced average deals - A forward where the price is unfixed at deal time and will be fixed by recording a future average plus a premium

Commodity swaps - Financially settled difference between a fixed price and an average fixed during some future period between trade date and maturity

Physical forwards - Either fixed or unfixed, based on LME prices with an added physical premium

FX forwards - for hedging FX risk

MetalRiskManager offers 3 independent services

1. Portfolio Valuation and Stress Testing

We require the user to upload a portfolio of positions in a CSV file format of LME positions and or physical exposures, either as a real portfolio or as a possible what if scenario. The user chooses from a drop down of dates for valuation. Metal Risk Manager produces an enriched CSV file with all positions in the portfolio valued in a matter of minutes. Reporting is both on an individual basis and with summary information broken down across counterparty if required. The portfolio is stress tested by movements in price and volatility and a risk matrix with projected Profit or Loss displayed. The download is available for use with in house reporting.

2. Option Calculator

The Option Calculator uses a choice of dates from LME market data. The user can price all LME supported contract types. There is the facility to factor in spreads both in the forward price and in option volatility to arrive at a realistic market price. There is also the facility to calculate zero cost risk reversals, and solve for a given premium paid or received.

3. Hedge Accounting Toolkit

Specify and document the hedge accounting relationship between hedged item and hedge. Create the lifecycle testing event table from designation to de-designation. Determine the testing strategies for prospective and retrospective testing. Test prospectively. Enter the Hedged Items (to determine the hypothetical derivative) and the hedge into MetalRiskManager.com. Test the hedge relationship retrospectively, using proxy shifts if necessary. Measure the effectiveness of the hedging relationship. Post to Equity and P&L.

Senior Financial Management from small to medium sized organisations, who have LME metal contracts as part of a hedging programme and want to view latest valuations, with counterparty exposure and/or want to stress test new hedging strategies; “what if “ scenarios based on changes to market price and volatility.

Auditors, who need independent fair value for LME contracts.

Physical traders who need the ability to react quickly “on the road” to changes in circumstances and market sentiment.

In Buy you will select the Paypal Buy button where you will be given the choice of using a Paypal account or one of the recognised credit card payment methods including Visa, Master Card, American Express and all major Switch and debit cards including Electron.

All transactions are over Paypal. As far as data security we store a minimum of data for audit trail purposes, so as to be able to recreate reports. We don’t require any sensitive counterparty information and we will never offer your data to any third party.

If you have any suggestions as to how we might be able to improve the service we will be very pleased to hear from you. You can contact us at support@metalriskmanager.com All emails are responded to promptly and you will receive a reply within 24 hours. We hope most questions are answered within these FAQ pages.

We currently limit the number of individual positions in a portfolio to 1000.

$500 per month per user.