Some fixing advice stem from the historical analysis of the market, others from market forecasts.
The best way to optimise is to use both the analyses.
Market forecasts and historical analysis are complementary.
A. Standard Fixing Advice : fixing advice based on market forecasts
- Always visible in the calendar of fixings in the application.
- Notified one working day before the day of the recommended fixing.
Pros: Market forecasts are the best evaluation made by the experts of what will most probably happen in the future in the markets based on the fundamentals of the markets and the interpretation or anticipation of the reactions of the stakeholders of the market, which evolves with time (new events and data available).
Cons: Some events are unpredictable and sometimes the most probable scenario does not come true.
>To know more, check: How are the forecasts made?
Market forecasts allow the buyer to decide on the basis of a probable scenario:
- Whether it would be better to wait to before making a fixing
Because the prices could decrease before the delivery.
- Whether it would be better to start making some fixings
Because there is a high probability that the prices could increase.
B. Alert Fixing Advice : fixing advice based on historical analysis
In the application the Alert fixing advice are:
- Visible in the fixing calendar only on the day of the alert.
- Notified to you to act upon it on the day the fixing needs to be made.
Pros: The historical analysis of the market considers the past and the present prices that won't change. It helps to identify a sharp increase in price or market opportunities, considering the past prices.
Cons: The historical analysis demonstrates more about the past than about the future. It does not help in identifying market opportunities in the remaining time until the delivery to optimize a product.