Exchange-traded derivatives risk management – An Interview with Giuseppe the founder of Cumulus9
ComTech Advisory: How do you see the evolution of energy & commodity financial markets and exchanges?
Giuseppe: The energy and commodity markets are rapidly evolving towards greater digital integration and transparency. As global trade becomes more interconnected, the need for sophisticated risk management tools becomes paramount. Exchanges are adapting by implementing more advanced risk models like VaR, moving away from traditional SPAN margining. This shift demands a new level of transparency and adaptability in risk analytics, areas where Cumulus9 is at the forefront.
ComTech Advisory: Is exchange-based trading growing in energy and commodities and why is it growing or declining?
Giuseppe: Exchange-based trading in energy and commodities is indeed growing, driven by a need for greater market stability and transparency. Regulatory pressures and market volatility have underscored the importance of having robust, transparent platforms that can handle complex risk calculations in real-time. This growth is also fueled by the increased adoption of technology that facilitates more efficient trading practices.
ComTech Advisory: What sorts of questions does your cloud-based platform answer for trading participants in these markets?
Giuseppe: Cumulus9’s platform addresses critical questions around margin requirements, risk exposure, and potential stress impacts. For traders and risk managers, it offers insights into how margin changes could affect their portfolios under various market conditions, and provides advanced stress testing tools to prepare for potential market shifts.
ComTech Advisory: Who is the platform targeted at?
Giuseppe: Our platform is specifically designed for derivatives market participants, which include the intermediaries such as the clearing brokers and futures commission merchants (FCMs), as well as the trading firms who are active in commodities and derivatives. It’s an ideal tool for those who trade across multiple markets and manage complex risk scenarios with efficiency and accuracy.
ComTech Advisory: How are you marketing it and are you interested in developing partner relationships with CTRM and energy & commodity credit risk vendors?
Giuseppe: Marketing has been predominantly through word-of-mouth, leveraging our existing industry contacts and partnerships. However, we’re expanding our efforts through strategic partnerships and collaborations, such as with CTRM vendors and other technology providers in the energy and commodities sectors. These partnerships are crucial as they help integrate our solutions more deeply within the market’s operational workflows.
ComTech Advisory: What sorts of features and functions might you add going forward?
Giuseppe: Looking forward, we are focusing on enhancing user experience by integrating advanced AI to allow users interact with our platform more intuitively and access data swiftly. Additionally, we plan to expand our stress testing features, allowing users to simulate a wider range of market scenarios and their potential impact on margin and liquidity.
About Giuseppe, founder, acting as Managing Director and lead architect at Cumulus9
Giuseppe is the founder of Cumulus9 and acting as Managing Director and lead architect at Cumulus9.
Giuseppe has set out to establish Cumulus9 as the gold standard of risk management on exchange-traded-derivatives. Before founding Cumulus9, Giuseppe worked as Head of Market Risk and Chaired the Management Risk Committee at G.H. Financials.
Giuseppe began his career as a market risk analyst at ICE Clear Europe. Giuseppe holds a BSc in Mathematics and an MSc in Risk and Stochastics. Giuseppe is passionate about coding and developing innovative cloud-native applications.
