I am reading the book by Sturm, what else can I do to get a very granular, hands on approach to gas trading?
I am a natural gas scheduler, and have been for 5 months, at a utility firm. My goal is to enhance my knowledge, add a graduate degree(part-time) from a renowned college(maybe not finish it but be in the progress towards that) by 2016-ish, and apply for a trader role.
From today to then, I need to learn trading and get a full grasp of it; the aspects, the hedging tools, etc.
Anyone in the Houston area that can help?
Anybody?
If you're a scheduler, I'm guessing you're sitting on the trading desk or very close to it. Why not just ask your trader(s) if you can shadow them for 1-2 hours per week to get a better appreciation of what they actually do. I've never worked at a utility but I imagine natty trading for a utility is more about asset optimization rather than pure spec trading. The latter is still clicking buttons but taking on risk and getting measured by daily PnL is a different kind of beast.
Sounds great in theory, that never works. Most, if not all, schedulers will say the same. You don't learn by asking your trader. Only time I've heard it work, at my firm, is when a scheduler offered golf training lessons in exchange for learning how to trade. The trader took it, the scheduler became a trader within 8 months.
No one is really "willing" to help "train" people. Even the people training me for scheduling was like pulling teeth. It's because they were responsible for my mistakes did they make a little more than a half-assed effort.
I've asked my boss; he's more than willing to and actually looking forward to it.
But yes, in theory, you are right about asset optimization. We do that over spec trading, we don't do any spec trading. Our risk stance is quite narrow.
It would seem you and I are in very similar positions (also a scheduler), with similar goals. I even bought the Sturm book too lol.
Not based in the Houston area though (Tulsa). Folks at my firm are really open to teaching when I ask them and they walk me through a lot, but cultures probably differ from place to place...
Honestly one of the best things that's been helping me is just making connections and seeking out mentors... even at other firms. Also PM me if you wanna exchange contact info, it may be mutually beneficial for us both...
If you're at a utility that doesn't spec I would imaging there isn't much to learn in the way of strategies but I could be wrong. They need more supply, they send out RFPs to approved counterparties. I guess it really depends on what kind of trader you want to be. Pm me if you have any specific questions about trading strategies.
I'm reading Strum too. I'm also a gas scheduler in Houston. Please let me know if you come across anything you find useful, and I'll do the same.
Find any trader at your firm/outside and make him/her your mentor. Stay on top of the news/research (DOE gas report, daily Platts research, weather and etc) but unfortunately the best way to learn to trade, is to trade. Ask questions on why you are making certain physical movements.
If you have access to ICE then I highly recommend watching it daily to figure out the pricing relationships. It is especially poignant to know the pricing at the points your firm trades at. If you follow the pricing long enough you get a sense for the relationships between points and can ask more intelligent questions that might elicit a valid response from your traders, mentors, etc. It also shows that you have a real interest and are making an effort. Also use ICE to follow the forward basis pricing, and apply the previous steps. If you don’t have access to ICE try to follow pricing through another source your firm probably subscribes to.
If your firm owns transport, knowing those contracts and paths is crucial as well. A trader has to be able to break down the cost of trading at various points along with the variable cost of transport in addition the price. As a scheduler I am sure you already have a good idea of this, but just in case.
Finally just keep networking and showing a real interest.
Trading Natural gas question (Originally Posted: 05/25/2012)
When you are trading natural gas futures using a broker such as interactive brokers, are you trading the natural gas price of the USA or the average international price or what?
Thanks!
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