Insights / Risk Management

Risk Management / 05.17.19

Commodity price risk management: When to hit the brakes

When you’re driving down the highway, you know when to put on the brakes. Minor puddles or road imperfections are inconsequential and won’t slow you down, but other risks may require braking. If you can see them far enough ahead, just covering the brake or maybe light braking is enough as a first response. But sometimes, a risk presents suddenly – a car cutting into your lane – and that calls for a more aggressive response. In sum, your braking is responsive to and proportional to the degree of risk in front of you, and how imminent that risk is.

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Commodity price risk management: When to hit the brakes
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