K-State Center for Risk Management Education and Research Announces New Student Fellows

The Kansas State University Center for Risk Management Education and Research has announced its third class of student fellows.

The center works to enhance the understanding of economic risks inherent in the global society through experiential education and research.

The 18 students selected for this class represent both undergraduate and graduate levels and include:
Dustin Aherin, master’s student in animal science and industry, Phillipsburg, Kansas;
Cheyanna Colborn, public relations, Iola, Kansas;
Christa Deneault, mathematics/economics, Concordia, Kansas;
Ryan Goetzmann, agricultural economics, Gardner, Kansas;
Adam Hancock, master’s student in agricultural economics, Indianapolis, Indiana;
Emily Harris, agribusiness, Abilene, Kansas;
Brady Heidrick, finance and accounting, Olathe, Kansas;
Pedro Masi, agricultural economics, Asuncion, Paraguay;
Christa McKittrick, finance and accounting, Mission Hills, Kansas;
Claire Newman, master’s student in agricultural economics, Auburn, California;
Cody O’Brien, agribusiness, Cherryvale, Kansas;
Samuel Power, finance and accounting, Lenexa, Kansas;
Nicholas Scherrer, economics, Overland Park, Kansas;
Jayce Stabel, agronomy, Lakin, Kansas;
Kylie Sturgis, public relations, Wilcox, Nebraska;
Tucker Styrkowicz, bachelor’s and master’s student, industrial engineering, Leawood, Kansas;
Lucas Sudbeck, agricultural economics, Seneca, Kansas; and
Morganne Wiltse, agribusiness, Wichita, Kansas.

“This is another stellar class of talented and accomplished student fellows. They will be a great group to work with,” said Ted Schroeder, director of the center and professor in the Department of Agricultural Economics. “The new student fellows will experience guest lectures and industry visits, conduct student research projects and receive tremendous interest from industry leaders.”

The new student fellows begin their program in January 2015.

By providing students and business professionals with the information and tools necessary to identify, quantify and manage risk, the center complements K-State’s strategic plan. Additionally, the center supports the greater university mission of advancing the well-being of the state of Kansas, the United States and the international community.

For additional information: Ted Schroeder  | 785-532-4488 | tcs@ksu.edu

Written by: Elaine Edwards | elainee@ksu.eduhttp://www.ksre.ksu.edu/news/

Posted in Center news, Research and education updates

Student Fellows visit the Commodity Futures Trading Commission in Chicago

On September 19, 2014, the Center for Risk Management Education and Research Student Fellows had the opportunity to visit the Commodity Futures Trading Commission (CFTC) while on a trip to Chicago, IL. Hannah Ropp, an analyst in the surveillance unit of the CFTC, gave a presentation entitled ‘Regulating Derivatives’ through a live video feed. Ms. Ropp has worked for the CFTC for four years in the Washington D.C. office and had plenty to share on the topic of regulating financial derivatives.

The presentation began with an overview of the history, structure, and goals of the CFTC. The operating functions of the three different divisions of the CFTC were discussed. Ms. Ropp expanded on the market surveillance and data collection and reporting units in greater detail. The student fellows were impressed by the amount of data that the CFTC stores and analyzes to ensure that each market is not undergoing manipulation. It was interesting to learn that this data is also used for the CFTC Market Reports that are accessible to the public through CFTC’s website, http://www.cftc.gov.

Another takeaway for the student fellows was learning about the cooperation between the CFTC and the exchange groups, such as the CME Group, in order to ensure a fair market. The CFTC and the exchange groups share information with each other and occasionally take action together if the need arises. One of the main focuses of Ms. Ropp’s presentation was that the CFTC sets regulations in order to ensure that the market works for consumers and business. Sometimes this can result in charges brought against people, but it keeps the market free of manipulation and reduces the risk for those in the market.

Through the visit to the Commodity Futures Trading Commission, the Center for Risk Management Education and Research Student Fellows were able to gain a better understanding of how this regulatory commission impacts financial derivative markets. The Center for Risk Management greatly appreciates the time that Ms. Ropp took to present this educational information and answer the questions that followed.

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Student Fellows visit the CME Group in Chicago

On Thursday, September 18th, CRMER Student Fellows enjoyed of a great visit hosted by the CME Group at the Chicago Board of Trade facilities in downtown Chicago. The Fellows where welcomed by Fred Seamon, Sr. Director, Commodity Research and Product Development and Matt Herrington, a K-State Alumni and Manager, Commodity Research and Product Development at the CME Group.

Fred and Matt led a tour through the CME Group’s now consolidated trading floor, where the Fellows experienced the historic, but now declining “outcry trading” in the traditional grains and livestock pits for futures and options and in the financial products’ pits. Open outcry trading accounts for around 10% of CME Group’s overall volume. Options has a heavier presence in the trading floors compared to futures, due to the complexity of options’ trading.

The tour to the trading floor was followed by a presentation by Bill Lange, Director, Market Surveillance. Market regulation’s overall purpose is to oversee market transactions on the exchange including trades and positions and to identify potential trade practice abuses. We heard about the Market Surveillance’s great emphasis on getting to know their customers, what their business is, and how they manage their risk in order to be able to better serve them and to better comply with the regulators. We learned about how different trading limits apply in different ways to hedgers and speculators and the factors that drive those limits, mainly delivery capacity from the exchange delivery facilities. It was interesting to hear the exchanges opinion about how the 2008 financial crisis influenced the relationship between the exchange and the regulators.

After hearing from outcry trading and market regulation, Jeff Hersh, from Global Account Management, talked to us about electronic trading. CME Group owns probably the world’s largest electronic trading platforms called CME Globex. CME Globex serves a wide variety of products and clients from around the globe, accounting for almost 90% of CME Group’s trading volume. Jeff also discussed about equal access and data distribution which guarantees fairness for market participants. In that direction, trades on Globex get registered by the matching engines on a first come, first serve basis. This is important to mention due to the ongoing controversy regarding market unfairness, specially relating to HFTC (High Frequency Trading) firms enjoying from speed benefits mainly in the stock markets.

Lastly, Jack Weaver, former trader on the CBOT trading floor, K-State alumni and now a personal trader (trading with his own funds), shared his personal experiences and interest in the futures markets since he was a kid, when he used to compare his profits from hog sales across years. Jack shared how the introduction of electronic trading changed his modus operandi, especially, the introduction of electronic trading allowed him to trade more variety of asset classes. He also stressed the importance of maximizing the use of strengths while minimizing weaknesses, which is key to being a successful trader. More narrowly, to know the behavior/performance of cash markets and timely access to good data, are key factors for successful traders.

The Fellows at the Center for Risk Management, Education and Research greatly enjoyed the financial markets experience and knowledge shared by the speakers. We very much appreciate CME Group’s hospitality and commitment to education through their support to the center.

Student Fellows in the Great Board Room at the Chicago Board of Trade

Student Fellows in the Great Board Room at the Chicago Board of Trade

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Student Fellows Visit Aon Risk Solutions

The Student Fellow’s final industry visit on the Chicago trip was on Friday, September 19TH with Aon Risk Solutions, which is a division Aon plc. Ann Gariti, Managing Director of Sales at Aon Risk Solutions, greeted the group and gave a brief overview of Aon plc’s business, which is summarized on their website, “Aon is the leading global provider of risk management, insurance and reinsurance brokerage, and human resources solutions and outsourcing services.”

Ms. Gariti then arranged for a panel of Aon Risk Solutions employees to come in and talk with the Fellows about their careers. The panel consisted of Ryan Kraus, Kate Simons, Britt Woodbury, and Patrick Wilson, who have been with Aon for 12, 6, 2, and 1 years respectively. With such varied experience, the panel provided an immense amount of insight about careers in general as well as careers with Aon Risk Solutions. The panel was very candid with the Fellows and answered all of the Fellows’ questions as well as happily visiting with some of the Fellows individually.

Ms. Gariti then led the Fellows through an exercise entitled “What do Aon Risk Solutions Brokers Do?” The exercise provided a good overview of a day in the life of an Aon Risk Solutions Broker covering areas such as consulting, optimizing risk costs, and building insurance programs around a client’s needs. The Fellows finished their visit to Aon with lunch and a visit to the 80TH floor of the Aon Center for breathtaking views, and local insight on the sights from Ms. Gariti.

The Fellows would like to extend thanks to Aon Risk Solutions, Ann Gariti, and the members of the panel for their time and insights, which they most graciously shared with the Student Fellows.

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Applications due tomorrow: Friday, September 12 for Risk Management Student Fellows

Applications are now being accepted for the 2015‐16 class of Risk Management Student Fellows. The application deadline is September 12, 2014. The Student Fellow program provides a foundation for undergraduate and graduate students to gain hands‐on risk management skills and knowledge. More information is available at the CRMER website at http://www.k‐state.edu/riskmanagement/.

Students accepted to the program will receive fellowship stipends for three semesters. Target students include anyone interested in risk management with three semesters left in their program including graduate students as of Spring 2015 semester.  The program has high expectations for student academic performance as well as risk management interest and engagement, so we will be selective in reviewing applicants.

Applications should include a resume, a statement of career objectives, and contact information for two or more academic references. Send resume, reference list, and career objective statement via email attachments to Ted Schroeder, tcs@ksu.edu by September 12, 2014 (he will confirm receipt of your application via email reply). Contact Ted Schroeder, Waters Hall 219, if you have questions.

Posted in Center news, Research and education updates

CRMER Student Fellows Visit Gavilon, LLC

                Gavilon Visit

The Center for Risk Management Education and Research (CRMER) student fellows visited Gavilon, LLC in Omaha, Nebraska on Friday, September 5, 2014.  Gavilon is a founding partner of CRMER and has continually offered their support from the beginning.

Ed Prosser, a CRMER advisory council member and Vice President of Agricultural Trading at Gavilon welcomed the student fellows to their new facility.  Ankush Bhandari, Director of Economic Research at Gavilon, joined Prosser for a presentation entitled “Emerging Trends in Agriculture and Energy.”  They set the stage for the day by providing student fellows with the basics of what factors affect supply and demand.  Much of the discussion was centered on increasing world populations and income as well as government policies that affect bio-fuel and energy prices.  Prosser emphasized that demand is easier to forecast than supply and that higher grain prices in the recent years have shifted the acreages among crops.  Bhandari provided the student fellows with statistics that illustrated the current world economic situation. 

The Gavilon Risk Management Team followed with a discussion addressing Gavilon’s risk preferences and how they analyze the company’s position in the market.  Robert Wagner, the Chief Risk Officer at Gavilon, and his team educated the student fellows on the statistical formulas and software they use to ensure the company will be able to withstand worse-case scenarios. 

Ed Prosser emphasized that the main job of a trader is to make sure he or she is in business tomorrow.  That is an excellent point for the student fellows to keep in mind as they move into their future careers.

At the end of the afternoon, Jill Shedek, Associate Talent Resource Manager at Gavilon, informed the student fellows on career opportunities for upcoming graduates.  The student fellows look forward to working with Gavilon, LLC in the future and thank them for their continued support.  Companies like these allow students to broaden their horizons and become better prepared for their future careers. 

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Call for applications to the 2015-2016 class of Risk Management Student Fellows

Applications are now being accepted for the 2015‐16 class of Risk Management Student Fellows. The application deadline is September 12, 2014. The Student Fellow program provides a foundation for undergraduate and graduate students to gain hands‐on risk management skills and knowledge. More information is available at the CRMER website at http://www.k‐state.edu/riskmanagement/.

Students accepted to the program will receive fellowship stipends for three semesters. Target students include anyone interested in risk management with three semesters left in their program including graduate students as of Spring 2015 semester.  The program has high expectations for student academic performance as well as risk management interest and engagement, so we will be selective in reviewing applicants.

Applications should include a resume, a statement of career objectives, and contact information for two or more academic references. Send resume, reference list, and career objective statement via email attachments to Ted Schroeder, tcs@ksu.edu by September 12, 2014 (he will confirm receipt of your application via email reply). Contact Ted Schroeder, Waters Hall 219, if you have questions.

Posted in Center news, Notes from the faculty