Valuation

valuation.jpgDoes your organisation fully understand the embedded value within the equity portfolio? This can be highly complex and replies on both paper and physical trading expertise. Opportunities such as pricing period options are often included in the sale of a physical cargo without full knowledge of the value determined by the current market conditions and structure. Being able to better understand the value that your counterparty views in these options will give you an advantage at a time of contract and price negotiation.

Case Study

A producer traditionally selling crude cargoes with pricing options had not considered their value in the volatile market. It was assumed that, as they received a higher premium for cargoes with a pricing option relative to those that did not, that the producer was gaining greater value. Smart Global deconstructed the precise option for its client and built a user friendly valuation model in order to give a true valuation of the option for each cargo sold.