Monte-Carlo-Simulation

Reducing the Purchase Price Volatility of Commodities

Reducing the Purchase Price Volatility of Commodities

Timo Six, Arnd Wiedemann
Commodity prices are one of the key cost drivers in industrial enterprises. Due to the volatility of market prices they hold a significant risk for potential losses. The purpose of this paper is to demonstrate how a purchase department can reduce the volatility of commodity prices by implementing an active risk management. It is shown how to carry out a systematic review and assessment of commodity price risks and how to smooth short-term price fluctuations by using effective instruments.
Industrie Management | Volume 30 | 2014 | Edition 5 | Pages 7-11
Lifecycle Cost Assessment of Different Energy Systems under Risk and Uncertainty

Lifecycle Cost Assessment of Different Energy Systems under Risk and Uncertainty

A New Approach for Economical Efficient Investigations
Waldemar Retkowski, Nils Buttler, Jorg Thöming
The impact of uncertainty and the complexity of renewable heat and hot water production generate the demand for intelligent cost performance analyses to support or provide resilient data and therefore reliable managerial decisions. Especially the risk control and the planning of invest and operating costs of energetic systems are with the help of exact mathematical models only insufficient feasible. One approach provides the monte-carlo-simulation projection with the possibility to handle deterministic and stochastic model approaches. A new approach for the model based investigations of strategic investment decisions for solar heat, geothermal heat or biomass heating systems under consideration of complex uncertainty is the objective of this contribution.
Industrie Management | Volume 29 | 2013 | Edition 6 | Pages 31-36