Responsibility

Compliance

Regulatory Compliance

This area is focused on anticipating new regulatory requirements that may impact the company’s business and developing a strong culture of compliance with rules and regulations amongst employees. They also ensure hedging transactions on the exchanges are fully compliant with all rules and regulations, and preserve our reputation as a reliable actor in the market.

Trade Practice Compliance

This area is responsible for policies and controls for the avoidance of corruption and making sure our company refrains from any business activity that does not uphold our ethical standards as stated in our Code of Conduct. It consults on trade practice compliance, training, risk mapping, the selection of adequate business partners and our policy on whistle blowing. Close

Risk management

The overriding objective of CogniSpark FZE price risk management program is to accommodate participation in favourable price movements whilst eliminating a proportion of the downside risk at an adequate margin above operating cash costs of site operations.

Price Risk

Prices variations are the most well known risk. Producers, manufacturers and consumers are all affected by changes in prices. Prices are based on the supply and demand of a market. It is impossible to predict exactly which way a price will move in the future, but by using historical data and trend watching, the risk of unexpected price movements can be reduced. Therefore the different parties agree on futures contracts to make sure they buy or sell their products at an acceptable price thereby relinquishing any possibility to make an even greater profit should the market move in their favor. Read more

Basis Risk

This is a risk that occurs when hedging a commodity to minimize the effects of price fluctuations. This risk occurs when the basis or the difference between the spot and futures price, changes between the time a hedge is placed and lifted. Depending on the direction of the basis changes, it will be beneficial to one position and detrimental to the other position. Due to the basis being fairly stable, the potential loss or gain can be predicted with some degree of certainty. This type of risk cannot be eliminated via hedging, but due to its predictability can be calculated into the risk assessment.

Basis Risk

Prices variations are the most well known risk in commodities. Producers, manufacturers and consumers are all affected by changes in prices. Prices are based on the supply and demand of a market. It is impossible to predict exactly which way a price will move in the future, but by using historical data and trend watching, the risk of unexpected price movements can be reduced. Therefore the different parties agree on futures contracts to make sure they buy or sell their products at an acceptable price thereby relinquishing any possibility to make an even greater profit should the market move in their favor. Close

Finance

From inception, CogniSpark FZE has been successful in building long-term relationships in the financial sector and diversifying its banking partnerships. Today we work with 6 leading regional financial institutions.

As a growing business with interests throughout the world, CogniSpark FZE has always sought to establish local partnerships for its investments, such as establishing an independent revolving credit facility specifically for the Middle East, and creating borrowing bases in ASIA and the Europe to finance trading operations in those regions. Read more

Such an approach has benefited our profitability and enabled us to increase credit lines even through the global financial crisis. Our culture is one of financial prudence. We maintain a strong liquidity position and our assets are optimally financed. Close