Browse CFA Level 1

Chapter 14: Commodity and Natural Resource Techniques

In this section

  • Storage and Transport Economics
    Explore how storage and transportation logistics influence commodity and natural resource investments, from cost impacts and supply chain bottlenecks to seasonal factors and regulatory considerations.
  • Advanced Commodity Derivative Structures
    Explore exotic derivatives, swaps, volumetric production payments, and structured notes in commodity markets, including practical hedging techniques and best practices for risk management.
  • Inflation Hedging and Currency Risk Management
    Explore how commodities can help mitigate inflation risk and discover effective currency hedging strategies crucial for global commodity transactions, encompassing real asset-based solutions, emerging market challenges, and dynamic hedging approaches.
  • Environmental Impact, Carbon Credits, and Regulation
    Explore how commodity production and consumption intertwine with carbon emissions, discover the mechanics of cap-and-trade systems, and learn about global regulatory frameworks shaping carbon markets.
  • Commodity Index Construction Methodologies
    Explore how major commodity indices are built, weighted, and rolled, and discover how these methodologies impact performance, risk, and diversification in multi-asset portfolios.
  • Roll Yield and Convenience Yield
    Explore how the shape of the futures curve drives roll yield and discover the value of physically holding commodities through convenience yield.
  • Sovereign and Producer Hedging Objectives
    Discover how sovereign entities and commodity producers hedge to stabilize revenues, lock in costs, and reduce vulnerability to price swings in the global market.
  • Climate Risk and Carbon Offsets
    Explore the rising importance of climate risk measurement, the role of carbon offsets in meeting net-zero goals, and the financial implications for commodity-driven investments. Includes verification processes, criticisms, insurance solutions, and new product developments.
  • Insurance-Linked Instruments for Catastrophe and Weather Risk
    Learn how CAT bonds and weather derivatives protect against natural disasters, examining parametric triggers, pricing complexities, and diversification benefits.
  • Physical Delivery Logistics and Supply Chain Concerns
    Explore key operational considerations, trade finance, and contingency planning for delivering physical commodities in futures markets, with insights into licensed delivery points, warehouse storage, and supply chain technologies.
  • Commodity-Specific Trading Strategies (Metals, Energy)
    Explore advanced trading strategies for base and precious metals, understand the unique supply-demand dynamics in energy, and learn how to integrate fundamental and technical analysis for risk-adjusted returns.
  • Geo-Political Tensions and Resource Nationalism
    Explore resource nationalism under geopolitical pressures, focusing on how sudden policy shifts, expropriation risks, and regulatory changes impact commodity investors.
  • Commodity Spread Trading and Arbitrage
    Explore advanced commodity spread trading and arbitrage techniques—from crack and crush spreads to calendar and location spreads—for the CFA® 2025 Level I curriculum.
  • Seasonality Analysis in Agriculture and Energy
    Explore how predictable planting, harvest, and energy demand cycles—alongside weather disruptions—impact commodity prices and shape strategies for traders, portfolio managers, and investors.
  • Advanced Techniques in Commodity Factor Investing
    Explore multi-factor models, momentum, carry, and value strategies in the commodities space, including risk management overlays and real-world implementation considerations.
  • ESG Monitoring in Extractive Industries
    Explore key ESG metrics, governance frameworks, and real-world practices for monitoring environmental and social impacts of extractive industries in this comprehensive CFA® 2025 Level I guide.
Wednesday, April 9, 2025 Monday, January 1, 1

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