Exchange Traded Brokerage
- Natural Gas
- Electricity
- Refined Products
- Grains
- OTC Clearing
ACCESS TO MULTIPLE CLEARING MEMBERS
RMI is one of the largest introducing brokers for energy transactions conducted on the New York Mercantile Exchange (NYMEX). RMI’s association with Man Financial and R.J. O’Brien addresses clients' need for a premier clearing member of all the major futures exchanges. Man Financial has customer segregated funds of over two billion dollars and is the world's largest energy futures brokerage firm. R. J. O'Brien has customer segregated funds of over four hundred million dollars and is one of the oldest and most well-known futures brokerage houses. While many institutional stock and bond firms are exiting the commodity business, both Man Financial and R.J. O’Brien continue to support commercial clients in the traditional core business of futures and futures options.
NYMEX OTC CLEARING
The creditworthiness of a bilateral transaction is only as strong as the two participants. A fundamental reality in the OTC market is one where the best bid/offer is sometimes provided by a counterparty that does not meet clients’ credit requirements. NYMEX OTC clearing offers the flexibility of a traditional OTC transaction with the creditworthiness of the NYMEX, a critical issue in today's markets.
MARKET LIQUIDITY AND TRANSPARENCY
Regulated exchanges provide a forum for both price discovery and immediate execution. The operational and transactional flexibility of exchange-traded instruments as well as the ease of converting these instruments to physical supply enhances a company's ability to mitigate risk. This open, transparent market also provides RMI with a conduit to present clients with concise, current market information. RMI's experience over the past sixteen years in executing transactions on behalf of clients through both floor and electronic trading is unparalleled in the brokerage industry.
Over-The-Counter Brokerage
- Natural Gas
- Electricity
- Coal
- Refined Products
- Emissions
Risk Management Incorporated (RMI) and leading over-the-counter (OTC) energy commodity intermediaries have entered into co-brokering agreements. The agreement allows RMI to augment the services provided to existing exchange-based brokerage clients by having transactional capabilities across virtually all commonly traded energy-related products.
There are many reasons why using a broker can make economic sense. Here are just a few.
ANONYMITY & COMPETITIVE PRICING
When clients call various counterparties directly, those potential counterparties will easily surmise whether the client is a buyer or seller. This information allows them to adjust their price accordingly. When a broker goes into the market on the behalf of a client, the potential counterparty does not know whether the client is a buyer or a seller. The end result is a bid and offer spread that is not skewed. Additionally, a broker solicits a market with all of the available counterparties. Some counterparties are better buyers or sellers than others. Having a broker canvas the entire market helps to assure a fair price.
SPEED
The energy markets have exhibited extreme volatility in the past. Frequently when a client sees a price that they like, by the time they get to their various potential counterparties and those various potential counterparties get back to them, the market has moved by a substantial amount. Over-the-counter brokers have direct and open lines to most major players in the energy business. They are often able to reach many potential counterparties and garner price quotes in a matter of seconds.
“ON THE STREET” INFORMATION
Over-the-counter brokers are on the phone virtually all day with various players involved in their markets. Knowing the activity level of the market, as well as having knowledge of various anomalies in the market, can lead to better pricing decisions. Another added benefit is having specific counterparty information. Because brokers are involved everyday in the market, they are often the first to hear of potential financial problems with a particular counterparty. With credit being an on-going concern, this information can prove to be very valuable.