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Every trade has a signed quantity: positive for buys, negative for sells.

A position is the sum of signed quantities for the same commodity, delivery period, and book. If you buy 500 MWh and sell 300 MWh, your net position is +200 MWh (long).

Delta exposure is the net position across all books. It tells you how much price risk you carry.

Hedge coverage measures how much of your physical position is offset by hedge trades.

Formula: |Hedge Position| / |Physical Position| x 100%

75% coverage means three-quarters of your price exposure is hedged. The remaining 25% is your delta exposure.

Mark-to-market (MTM) P&L values your position against the current forward curve.

Formula: (Market Price - Trade Price) x Signed Quantity

If you bought at 25 and the market is now 27, each MWh is worth +2. If you sold at 25 and the market rose to 27, each MWh costs you -2.

The key insight: short positions (sells) profit when prices fall, and lose when prices rise.

A forward curve shows the market price for each future delivery period.

Contango: later months are more expensive (upward slope). Common when storage/carry costs dominate.

Backwardation: later months are cheaper (downward slope). Common with seasonal demand patterns.

The curve is the benchmark for valuing all your positions. Without it, you cannot calculate MTM P&L.

A trade is more than a quantity and a price. Every trade has:

  • Trade Date: when the trade was executed in the simulator's business clock. Not the same as the Delivery Period (when the energy flows) or the Business Date (today's valuation point). In a real ETRM you would also see a separate system capture timestamp; the simulator stores one but does not display it.
  • Delivery Period: when the energy is physically delivered or financially settled. A period is a date range, not a single day.
  • Instrument type: Physical (actual energy delivery) or Financial/Swap (cash-settled contract referencing a price index)
  • Book: an analytical grouping (Physical, Hedge). Where the trade lives, not what it is
  • Counterparty: who is on the other side (not yet modelled in this simulator)

The blotter you see on screen is a view of the trade, not the trade itself. Production ETRM systems store far richer data per trade, including legal entity, broker, confirmation status, and audit trail.

The simulator collapses several real-world clocks into one: in a real ETRM, traders may enter today a deal done yesterday, ops may amend later, and back-office may book late. Here, Trade Date always equals the Business Date at the moment the trade was entered. That is a deliberate teaching simplification.

P&L labelled "Indicative" in this simulator uses the forward curve: what the market currently expects prices to be at delivery.

Once delivery actually happens, the forward price is replaced by the settlement price: what actually occurred. These often come from different data sources and are captured at different timestamps.

In production, the difference between the last forward mark and the settlement price is called roll variance. It is one of the most common sources of P&L surprises.

This simulator uses MWh (megawatt-hours) throughout for consistency.

In Great Britain, gas is traded in therms (1 therm = 0.0293 MWh) and power in MWh. Continental European gas (TTF) trades in MWh. Real ETRM systems handle conversion between the trade's unit of measure and the display unit.

Getting units wrong is one of the most common production bugs in energy trading. A trade entered in therms but valued in MWh (or vice versa) will show a P&L that is off by a factor of ~34.