The business of commodities trading and logistics management necessarily entails the firm taking on positions. The success of the firm since 2014, has relied on a robust risk management framework, where risk is: identified, quantified ( or qualitatively assessed ) and then monitored. This understanding forms the basic intellectual architecture of the firm and the systems operations of the company have been developed to serve that understanding.

The firm utilises a mixture of; Industry leading front-to-back multi tenant SaaS solutions covering our physical and financial trading workflows with integrated market data, analytics , and real-time reporting which integrates telematics and stock management inputs. Propietary systems designed to capture the specificity of our own geographic and industry specific challenges, employing machine learning, whilst preserving commercial confidentiality and customer data.

Pre-Deal Structuring: Formal assessment of deal flow, with financial, operational, treasury and macro perspectives. Where appropriate a different trading team may independently model the deal flow to test the basic assumptions and to identify areas where support ( technical or commercial ) may be required across the firm. In this phase, the process aims to identify and quantify basis risk inherent in any commercial transaction; such as contractual risk, counterparty risk and operational risk that are not perfectly hedged or matched.

Ongoing Risk Management: DUCAT AFRICA has a rigorous ongoing risk management process in place which involves a minimum of three functions: Trading, Operations and Execution/Reconciliation teams. Depending on the complexity of the transaction, either the trader or the risk team, is responsible for creating a daily or weekly updated Value at Risk figure, highlighting any potential deviations from the original assumptions made at commencement.