The Derivative cover image

The Derivative

Systematic Commodity Trading (without Trend) with Jae-Min Hyun of NWOne

Oct 5, 2023
Explore the intricacies of building a systematic commodity trading strategy using fundamental inputs, the importance of risk management, and the role of machine learning. Discover the challenges of navigating this dynamic market and the complexities of this niche within the world of finance. Gain valuable perspectives for both seasoned traders and those seeking to understand commodity trading nuances.
01:05:46
Creator website

Podcast summary created with Snipd AI

Quick takeaways

  • NWOne utilizes a bottom-up approach, focusing on market fundamentals rather than technical factors, to extract alpha from commodity markets.
  • NWOne employs a diversified portfolio and multiple strategies, including outright futures trading and calendar spreads, to ensure exposure is not concentrated in any one market.

Deep dives

Jamin Hinn of NW1: Extracting Alphas from Commodity Markets

Jamin Hinn of NW1 discusses their systematic strategy that focuses on extracting alphas from commodity markets. They use a bottom-up approach, analyzing market fundamentals rather than relying on technical factors. They trade in multiple commodities and employ multiple strategies including outright futures trading, calendar spreads, and intraday trading. Their models are designed to capture inefficiencies driven by market fundamentals in each commodity and their portfolio is diversified to ensure exposure is not concentrated in any one market. The firm is actively researching and expanding their strategies, and while they are not currently using AI extensively, they incorporate machine learning tools for research and portfolio generation. The podcast also touches on the challenges of data availability and the uniqueness of commodity markets.

Remember Everything You Learn from Podcasts

Save insights instantly, chat with episodes, and build lasting knowledge - all powered by AI.
App store bannerPlay store banner