Market Health Check

09 May 2005

Warning this market could damge your wealth

The UK Power market saw bullish activity in the Winter 05 and 06 baseload. Powerisk asks whether the market is healthy with good volatility coming back into the market. There is no doubt that reasonable volatility a number of hedge funds and banks all playing in the market and fewer credit scandals suggest that the market is reasonably healthy. However, liquidity has dropped brokers are struggling with only three sharing the pot, and baseload is the predominant product and their is no index which looks as though it is unbreakable. Costs associated with cash out are rising and bid offers are widening with less liquidity. The market is losing natural customers with some of the big natural longs struggling to off load volume without moving the market. Exposure to price is something all are taking and the basis risks on shape are widening.


Baseload  Winter  Winter  Finance  Finance  Risk Management 

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