Do you want to have a career in energy trading? You will be in an exciting field. Energy is the catalyst to not only the U.S. economy, but to the world. As in most industries, the energy trading industry is dynamic. Therefore, not only must you get training for energy trading, but you must stay on top of the trends and changes in the field.

To build a successful career and move up in the world, you will need to build a library. You’ll also want to subscribe to different energy trading magazines. To get training for energy trading, do the following:

1. Understand energy trading by taking courses.

2. Acquire more energy trading training through books or CDs.

3. Work with energy trading companies through an internship.

Action Steps
The best contacts and resources to help you get it done

Take energy trading courses to understand the energy trade market

To be a successful energy trader, you should definitely consider taking courses. You don't have to spend many years in school. Instead, you can take courses online that last for only a couple of days. Courses give you an introduction to energy trading, including natural gas trading and gas trading.

I recommend: Peice offers training for energy traders; the course only lasts for about two days. You will learn about energy trading risk management, including financial, performance, physical, and cross-commodity. Tulane Energy Institute is another educational resource that energy trading companies use for training.

Use books and CDs to get more energy trading

Are you looking to save money, but yet want your employees to get the best education in training? Then you should consider purchasing books and CDs for your employees. Your employees can study topics such as understanding how to get the master trading equation or why do energy traders trade components of the master equity equation, rather than prices. Other topics you'll cover are accrual and profit and loss accounting or mark-to-market.

I recommend: PGS Energy Training makes and sells energy trading training materials. The materials cover the fundamentals of energy trading and the energy trading equation. DownstreamToday is another resource that sells books on energy trading. The website has books that cover a wide range of topics, including energy risk management, hedging, and futures.

Get an internship with energy trading companies

After you have read all of the books and attended schools, then you should consider an internship with an energy trading firm. Getting an internship enables you to get real world experience. You'll not only be working with energy traders, but you'll gain an understanding of how energy trading works. You'll also work with the company's energy trading software. No doubt, this will look good on your resume.

I recommend: RBS Sempra Commodities is a full-service energy trading company that specializes in natural gas trading, power, and petroleum trading. Sempra Commodities is one of the largest energy trading companies in North America. DTE Energy is another company where you’ll want to seek an internship. This company has more than 150 years in energy trading.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  To gain more knowledge in energy trading, consider attending seminars. You can get more knowledge about the energy trading field and gain the latest inside knowledge from special guest speakers.

Energy trading requires the right knowledge tools to give you an edge over the competition. Natural gas trading, one of the key energy trade market segments, allows you to leverage your understanding of market conditions to forecast trends. There are two approaches you can use: professional energy traders or energy trading software. In either case, you'll be looking for helpful tools to facilitate your energy trading. Risk management is critical to success.

Energy traders are industry professionals who evaluate prior use patterns, market conditions and inventory pressures to predict future energy costs. Energy trading software is a tool energy traders use to make their forecasts. You can use the same tools gas traders use by using one of the commercially available software packages. Before deciding whether to consult an energy trader or embark on your own as a gas trader, consider these factors:

1. Ability to understand principles of energy trading risk management

2. Comparative level of trust in energy trading firms versus reliance on energy trading software

3. Willingness to tolerate risk in both the short and long term as an energy trader

Action Steps
The best contacts and resources to help you get it done

Assess the track record of energy trading companies you are considering

Seek references or testimonials from previous clients. Look for nationally or internationally connected firms whose reputation can be established. Be sure to verify the authenticity of Internet sources, and of course picking up the phone and talking with a company representative will yield useful information as well as a flavor of the company's customer service.

I recommend: Energy trading companies like Masefield and Towers Perrin have a global reach with offices in multiple countries. Firms like these offer the resources of industry experts to assist clients in risk management or market trends.

Energy trading software supported by real experts enables users to optimize the program

Energy trading software supported by real experts enables users to optimize the program's features and benefits. Real-world engineers and market specialists supporting users of energy trading software make the software application robust and practical.

I recommend: IntercontinentalExchange, or ICE, offers a web-based real-time platform for energy trade with an on-screen demo for over-the-counter energy trading. POMAX by Navita provides a multi-use platform used by traders worldwide. Helpful components include trading, risk management, market and data analysis and most importantly consulting with Navita staff engineers.

Sign up for forums or industry events or use an energy trading simulator

Information clearinghouses connect you to industry people and events. Choose either an energy trader or energy trading software to match your acceptable level of risk.

I recommend: The Energy Exchange provides a database linking technical experts in the energy field with financial analysts and investors. Visitors find links to energy companies, universities, government entities, trade organizations and allied service providers. Take a test drive with PFGBEST.com's energy simulated trading software with a 30-day free trial.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Review a list of times and locations for conferences of energy traders where you'll rub elbows with representatives of energy trading firms and developers of energy trading software. Ask questions, network and learn lessons from industry insiders.

Do you want your new employees to be successful energy traders? Take advantage of tools out there for your energy trading firm. Although you might spend some money, the upside is that you may not have to pay travel or hotel expenses. You might be able to do all of this training from your office.

Making the most of energy trading is crucial to your business’ success. You want your new employees to understand everything about energy commodities. To prepare them for energy trading, make the following options available:

1. Go to an online energy trading training school.

2. Understand the fundamentals of energy trading by applying energy trading software.

3. Use energy trade magazines to further knowledge of energy trading.

Action Steps
The best contacts and resources to help you get it done

Attend an online energy trading training school

Attending an online school enables employees to understand topics such as natural gas trading and gas trading. Consider sending an employee to school because it helps him or her to become a better energy trader, which in turn benefits you. Energy trading online courses exposes them to understanding energy exchange markets, distribution, and infrastructure.

I recommend: Energy Institution is for new hires in that the course covers energy infrastructure. Topics they will learn about include oil exploration, refining processes, and generation sources. You’ll also want them to attend Paradigm Training, which helps energy traders to understand energy trading risk management.

Use energy trading software to understand the fundamentals of energy trading

If you're not using an energy trading software application, take the step. This should be a given in today's world. Using energy trading software enables you to identify trading opportunities and assess your market positions. Since you'll have the ability to access data in real-time, you can make better business decisions. If you need results from complex formulas, an energy trading software tool can get these for you.

I recommend: ICTS Symphony makes energy trading risk management software that performs complicated formulas. Many energy trading companies use this software tool, which supports the following commodity markets: natural gas, petrochemicals, and natural gas liquids. You’ll also want to look at Allegro, which performs functions such as accounting, scheduling, and making sure your company complies with the government's regulatory laws.

Subscribe to energy trading magazines

This is another way of staying on top of the energy trading market. You can read what other energy trading firms are doing. Online magazines can give you the current and breaking news in the energy trading sector. Online magazines cover issues that affect energy, such as regulation.

I recommend: Incisive Media is an online energy trading magazine that many professionals read. Topics that the writers will write about include oil market regulation or natural gas supply. EINNEWS also provides energy trading news.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Encourage your employees to join an energy trading professional association. Employees will be able to network with other energy traders, learn about seminars, and learn more about what energy trading companies are doing.

Like any other commodity, energy trading is the process of trading energy contracts to determine the price on the open market. Energy trading consists of a number of energy sources, including oil and natural gas. Energy trading is similar to other types of stock and commodities trading, but often includes more short-term selling for quicker profits. Energy trading is also part of the futures market, in which prices can be set months in advance.

Action Steps
The best contacts and resources to help you get it done

Value at risk (VaR)

The value at risk technique in energy trading is a way to measure the risk of the trade based on a statistical analysis or historical price trends. Measuring the risk over a period of time helps to determine the volatility of the commodity being traded.

I recommend: The Risk Glossary provides an expanded definition of value at risk techniques.

Exchange-traded fund (ETF)

An exchange-traded fund is a security used to track a specific commodity index. Similar to an index or mutual fund, an ETF is traded daily like a stock and provides buyers with more options, such as selling short and not having to buy a set quantity of shares.

I recommend: Nasdaq provides information on ETFs in the energy trading market.

Short covering

Short covering is the process of purchasing gas contracts that will offset the short positions currently held. This is evident in the market when there is a high daily volume of trades.

I recommend: Green Faucet Expert Market Commentaries provides information on short covering in energy trading and how this can drastically affect natural gas and oil prices throughout the year.

Expiration

Expiration in energy trading happens when a contract on the New York Mercantile Exchange ceases trading.

I recommend: The NYMEX expiration procedure and daily schedule are provided by the CME Group.

Futures market

The futures market is a trading market that helps determine the prices of energy contracts for the delivery of a specific amount of energy commodities at some point in the future.

I recommend: Investopedia explains the basics of the futures market and futures investing.

New York Mercantile Exchange (NYMEX)

The New York Mercantile Exchange is a commodity futures exchange that has been the top trading exchange for energy commodities for more than 100 years. The NYMEX is also a commodities exchange for metals such as gold, silver, copper and aluminum.

I recommend: The New York Mercantile Exchange website includes news, market data, education for traders and real-time prices during trading hours.