System Features

The major system features are summarized below:

Futures Processing

  • Supports futures markets with either monthly or daily contracts.
  • Calculates broker commissions based on market and commodity.
  • Allows fixed commissions, percentage commissions, or combinations.
  • Allows use of separate executing and clearing broker
  • Calculates original margins and variation margins for domestic markets.
  • Matches hedges to the underlying contract based on trader defined deal number.
  • Allows entry of futures based on monthly averages, with automatic pricing.

Physicals Processing

  • Provides tracking of both gross quantity and quantity contained.
  • Allows entry of hedge ratio required for several agricultural commodities
  • Allows unpriced contracts with multiple (partial) pricings; recalculates the weighted contract price after each pricing.
  • Provides automatic pricing of unpriced contracts based on monthly (or other Time period) averages.
  • Supports multiple warehouses for inventory for each commodity location.
  • Allows inventory to be pledged to a bank with full reporting - collateral movement reports and collateralized inventory report.
  • Provides reporting of physicals contracts in a standard unit of measure; each commodity may have different standard unit if necessary.

Options Processing

  • Allows entry of either exchange traded or over-the-counter options.
  • Allows valuation based on either fair value of premium or mark-to-market against closing premium values.
  • Allows premium recognition at trade date, at liquidation, or pro-rata over life of option.
  • Provides separate reporting of options positions.
  • Provides delta hedge reporting.

Position Valuation

  • Values futures contracts against market quotes which may be entered or imported.
  • Allows interpolation/extrapolation of market prices using quoted value date.
  • Calculates 'fair value' premium on options using Black-Scholes model.
  • Allows valuation based on market premium quotes or fair-value premiums.
  • Allows definition of physicals market price as a premium or discount to an established futures market price with a corresponding value/delivery date; the premium or discount may be a fixed amount, a percentage, or both.
  • Calculates the premium risk on unpriced contracts, as well as on the unpriced portion of partially priced contracts.
  • Provides valuation of liquidated but unpriced contracts in the event of liquidation prior to actual price finalization.

Liquidations

  • Allows multiple (partial) liquidations of a contract.
  • Provides automatic close-outs of offsetting futures within broker on FIFO basis.
  • Allows automatic close-outs of offsetting LME futures between brokers using settlement prices.
  • Allows provisional invoices; upon the finalization the system will automatically create final invoice representing difference between provisional and final values
  • Allows reversal of a liquidation with full audit trail and reestablishment of open positions, counterparty ledger (A/R or A/P) and inventory.
  • Provides facility to receive from or deliver to exchange where appropriate (warrant receipt or delivery).
  • Allows liquidation prior to pricing with ongoing mark-to-market valuations and monitoring until priced and finalized.
  • Allows delivery of product by going short inventory with appropriate reporting and valuation.

Traffic and Operations

  • Supports multiple reporting companies, markets, commodities, currencies, and units.
  • Allows markets, commodity, currency and units codes to be defined by the user.
  • Provides full inquiry and full error correction/adjustment capability.
  • Provides full editing of all input fields and provides default values to speed the data entry process.
  • Provides the ability to view all codes available when codes are required during data entry.
  • Provides four standard security levels, each password protected; additional levels or restrictions may be added.

Accounting

  • Provides integrated multi-currency counterparty ledger (accounts receivable and accounts payable).
  • Allows user-defined aging categories for the accounts receivable aging report.
  • Allows entry of non-trading exposures for inclusion on the credit limit report.
  • Allows entry on non-trading payments/receipts for inclusion on the cash flow projection report.
  • Generates standard summary journal entries which summarize trading activity for most automated general ledgers.
  • Allows entry of general ledger account numbers to be used in journal entries.
  • Allows accounting periods to remain open (for late cash posting, for example), and then closed as the journal entries are created.

Flexibility

  • Allows modification of screen labels, prompts and default values.
  • Provides ability to 'filter' reports to include only selected records.
  • Provides ability to add additional codes and contracts through use of user-controller parameter tables.