OI1: Cracking the Code of Commodity Spread Trading ft. Mauritz van den Worm
Top Traders Unplugged
Niels Kaastrup-Larsen
4.8 • 670 Ratings
🗓️ 1 November 2023
⏱️ 61 minutes
🧾️ Download transcript
Summary
You are invited to an eye-opening conversation with Mauritz van den Worm, a quant researcher at Polarstar, a commodities-focused hedge fund in Cape Town, South Africa, hosted by Moritz Seibert. In this inaugural episode of the Open Interest series, Mauritz takes us on a journey through the fascinating world of commodity spreads. We explore not only calendar spreads but also delve into cross-market substitution spreads, location arbitrage trades, and processing margin spreads.
Discover how PolarStar navigates the intricate South African commodity markets and the critical role they play in their portfolio. Additionally, Mauritz shares an intriguing firsthand account of PolarStar's position in the US versus European grain spreads at the onset of Russia's invasion of Ukraine. Learn how a simultaneous limit-up in the US and limit-down in Europe led to what Mauritz humorously refers to as "a few gray hairs." This is a must-listen for anyone intrigued by the complexities and strategies behind commodity trading.
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Episode TimeStamps:
02:09 - Introduction to the new series
03:28 - Introduction to Mauritz van den Worm and PolarStar Management
09:53 - A deep dive into the South African market
16:26 - What kind of trader is Polar Star Management?
19:55 - Entering and exiting trades
23:37 - How PolarStar Management establishes...
Transcript
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| 0:00.0 | I think a big part of what happened over there is you had a lot of funds that had a lot of segregated accounts. |
| 0:15.0 | And these segregated accounts had different risk managers. |
| 0:19.0 | The different big institutional investors, they might have their own risk managers signed to different segregated managers. The different big institutional investors, |
| 0:22.4 | they might have their own risk managers signed to different segregated accounts. |
| 0:25.0 | And once it hit their limit, |
| 0:27.0 | they just wanted to get out. |
| 0:28.6 | And a lot of them, I think, |
| 0:30.1 | pushed the market to these extremes. |
| 0:33.4 | I think kind of getting out |
| 0:34.8 | at exactly the wrong time. |
| 0:38.2 | Imagine spending an hour with the world's greatest traders. |
| 0:42.1 | Imagine learning from their experiences, their successes, and their failures. |
| 0:46.6 | Imagine no more. |
| 0:48.4 | Welcome to Top Traders Unplugged, |
| 0:50.9 | the place where you can learn from the best hedge fund managers in the world, so you |
| 0:55.0 | can take your manager, due diligence, or investment career to the next level. Before we begin |
| 1:00.0 | today's conversation, remember to keep two things in mind. All the discussion we'll have about |
| 1:04.7 | investment performance is about the past, and past performance does not guarantee or even infer anything |
| 1:10.4 | about future performance. |
| 1:12.0 | Also understand that there's a significant risk of financial loss with all investment strategies, |
| 1:16.6 | and you need to request and understand the specific risks from the investment manager about their product |
| 1:21.7 | before you make investment decisions. |
... |
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