We’ve replaced the “Knowledge” section of our website with our “Tools and Tactics” section. We have retained this section as an archive of our Weekly Corn Market Updates for the 2020 Crop Year and original versions of some of our first articles. Updated versions of those articles can be found on our Tools and Tactics page. Future editions of the Weekly Corn Market Update will be stored on their own page.
Risk Management vs. Speculation
Quartzite is in the business of measuring and mitigating risk. We're experts in the field, and we find it a more productive use of our time and our customers' time than guessing where markets are going. We're not against speculation - there are times and places for it. However, we see no reason that a producer's business should live and die with rises and falls in the markets. Instead, we want to give our clients the stability to invest in themselves and their businesses. We do our best to take the market out of the equation, and that is risk management.
Coining Some Terms
Risk management is intimidating. At Quartzite Risk Management LLC (Quartzite), in addition to our role as an advisor, we want to go the extra mile by being an educational resource for our clients. We offer this note in that spirit. The goal of this piece is to use an ordinary coin flip in examples to shed some light on a few of the terms we often use when advising our clients.
The Relationship Between Risk, Reward, Edge, and Risk Management
Risk is the potential for loss. A reward is a potential gain. Because we see risk and reward in many parts of life, we all have an understanding of these concepts and how they are two sides of the same coin.