A Review of the U.S. Senate Report on the Amaranth Debacle

9 Pages Posted: 9 Jul 2015

See all articles by Hilary Till

Hilary Till

Premia Research LLC; EDHEC-Risk Institute; J.P. Morgan Center for Commodities, University of Colorado Denver Business School; Global Commodities Applied Research Digest

Date Written: July 6, 2007

Abstract

On June 25th, 2007, the U.S. Senate Permanent Subcommittee on Investigations released a report on the Amaranth debacle, entitled, “Excessive Speculation in the Natural Gas Market.” The report was released in conjunction with the subcommittee’s public hearing on the same date.

The 135-page report (and its further 345 pages of appendices) provides a wealth of detail on the largest hedge-fund debacle to have thus far occurred. In carrying out their forensic analysis, the Senate subcommittee examined several million individual trades. The subcommittee obtained this information by subpoenaing records from the New York Mercantile Exchange (NYMEX), the Intercontinental Exchange (ICE), Amaranth, and other traders.

The report basically covers two areas: (1) It provides factual detail on how massive Amaranth’s natural-gas positions were; and (2) It discusses how inadequate the U.S. regulatory approach currently is in the face of large-scale energy trading. This review will mainly summarize what the report covered, and then will briefly touch upon important areas that the report omitted.

Keywords: Amaranth, natural gas, futures, regulatory

JEL Classification: G1, G18

Suggested Citation

Till, Hilary, A Review of the U.S. Senate Report on the Amaranth Debacle (July 6, 2007). Available at SSRN: https://ssrn.com/abstract=2628538 or http://dx.doi.org/10.2139/ssrn.2628538

Hilary Till (Contact Author)

Premia Research LLC ( email )

United States
312-583-1137 (Phone)
312-873-3914 (Fax)

HOME PAGE: http://customindices.spindices.com/custom-index-calculations/premia/all

EDHEC-Risk Institute

Nice
France

HOME PAGE: http://risk.edhec.edu/

J.P. Morgan Center for Commodities, University of Colorado Denver Business School ( email )

1475 Lawrence St.
Denver, CO 80202
United States

HOME PAGE: http://www.business.ucdenver.edu/commodities

Global Commodities Applied Research Digest ( email )

J.P. Morgan Center for Commodities
1475 Lawrence Street
Denver, CO 80202
United States

HOME PAGE: http://www.jpmcc-gcard.com/hilary-till

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