Case Studies: Trading Wins and Losses
Real cases in energy trading; lessons on discipline, leverage, and risk
Case Studies: Trading Wins and Losses
Executive Summary
Theory gives principles; practice teaches humility. This module presents five real cases—three winners, two losses—to show how professionals apply and sometimes misapply the tools covered in this series. The aim is to extract actionable lessons on discipline, leverage, risk management, and regulatory compliance. For practitioners and consultants, case studies support training and risk culture—and support book and consulting value.
Learning Objectives
By the end of this module you will be able to analyse trading wins and identify principles that generated profits, evaluate trading losses and understand failure modes, extract actionable lessons from real-world case studies, apply lessons to your own trading/hedging strategies, and recognise warning signs of excessive risk-taking.
Case Study 1: Strategic Petroleum Reserve Purchase (Winner)
In summer 2016 oil was 40–45/barrel and the US authorised SPR purchases (e.g. 2M barrels). Traders who anticipated that SPR buying would support the market front-ran it by buying WTI futures (e.g. 1,000 contracts at 40–42). As SPR buying unfolded, oil moved to about 48; the position gained roughly 6/barrel on 1M barrels, about $6M in a few weeks (15% return). Lesson: predictable supply (public SPR programme) can be traded before the market fully adjusts; execution was disciplined and size controlled. The trade relied on public information (SPR announcement), limited leverage, and a clear exit as the catalyst played out.