Commodity Financial Services
Olam’s Commodity Financial Services (CFS) business was started in 2003 when we decided to leverage our knowledge of leading-edge risk management practices to develop our ‘latent asset’ in the space of both commodity and derivative markets. Since launch, this initiative has witnessed strong growth, and in July 2010, we organically developed an independent business under the name Invenio. Today, Invenio has already achieved a leadership position on the London International Financial Futures and Options Exchange (LIFFE) and a steadily growing share on the Intercontinental Exchange / Chicago Board of Trade (ICE/CBOT).
Our CFS business launched its first Relative Value Commodity Fund (the Ektimo RV Fund) in July 2010. There are now three core business areas operated by Invenio, namely Market Making and Volatility Trading; Risk Management Solutions and Fund Management.
Market Making and Volatility Trading
The Market Making and Volatility Trading business adopts a sell-side approach and provides markets with options on a wide range of commodities that include almost all the futures-traded agricultural commodities, livestock, freight and emissions. This business provides two way markets on exchange-traded options to producers, consumers, traders and asset management companies through a well-established broker/dealer network.
Risk Management Solutions
The Risk Management Solutions business provides bespoke, client-centred solutions to large producers and end-users of commodities including our various business partners on the physical side of the business. This business provides a range of customised over-the-counter (OTC) solutions to a diverse customer base that precisely caters to our clients’ need to manage their commodity price risk. Our background in commodities gives us a unique advantage in this area, enabling us to provide them with the most appropriate and cost effective solutions that are hassle-free in their execution and documentation.
The Fund Management business is engaged in developing macro fundamental strategies as well as algorithmic strategies. These combine our experience and insight in commodity markets with our knowledge of derivatives and statistical and mathematical skills built over the years.