Allegro Development: Comprehensive Solutions to Optimize Commodity Risk

Today’s sophisticated and capital intensive commodity markets demand risk management solutions that drive instantaneous transparency into portfolios containing multiple commodities, instruments and currencies. The challenge facing the companies is to find an integrated solution that can capture, measure and report in real-time across complex portfolios allowing risk managers to act quickly on that information. For more than 3 decades, Allegro Development,headquartered in Dallas, TX, has been offering solutions to traders and risk managers enabling them to understand the impact of incremental positions on a portfolio and gain insight into potential risks and rewards.

Allegro’s risk capabilities include real-time simulations, volatility analysis and pre-trade credit verification. The risk simulation “what-if” tool allows companies to determine more accurately how potential market changes will affect various types of risk exposure. By employing simulation, users can identify potential risk behavior under various market conditions, anticipate market moves, and act accordingly to achieve superior portfolio performance.

Our modular solution allows customers to select only the components and functionalities they need

The company participates in the commodity value chain and offers optimization software to help clients better monetize their assets, reduce risk and realize greater returns in shorter span of time. Allegro’s flagship product, Allegro 8, is an enterprise-level risk management architecture that allows companies to manage operations and integrate new components as their needs change. The software is used by traders, risk managers, and decision-makers across the globe. The solution uses grid computing to manage numerically intensive processes such as real-time valuation and optimization and enables traders and marketers to view existing positions and to dynamically optimize them based upon real-time connectivity to more than 22 commodity exchanges as well as streaming pricing data.

“The uniqueness of this solution is that it allows customers to select only the components and functionalities they need, while simplifying deployment and enabling companies to quickly expand into new markets,” says Ray Hood, CEO of Allegro Development. Allegro’s architecture also uses a standardized integration component platform for flexible integration with existing platforms and with partner developed components that provide direct connectivity to sources like Platts, Morningstar, and commodity exchanges.

With offices in Calgary, Houston, London, Singapore, Sydney and Zurich,Allegro offers solutions in partnership with companies like SAP, Oracle, and PWC.
Caltex Australia, an integrated oil refining and marketing company, has been using Allegro’s transaction management system for a number of years. The company realized the need of Allegro’s solution when the market condition changed in Australia and refining in the country became non-economical. The client had to seek sources of supply in other parts of the world like South-East Asia, and the greatest challenge was to move the resources efficiently and quickly. With the use of Allegro’s solution that took less than a year to deploy, Caltex was able to save $40Mn dollars a year.

Looking ahead, Allegro plans to operate much more heavily in Latin America, Asia and Africa, three parts of the world with lot of energy resources. The company bases its strategy on acquiring the best talents and constant innovation on which Hood comments, “In the coming years, our products and the capabilities of our product will rise up the curve from transaction system into the kind of world class analytics and optimization that people expect in other sectors and which we will be providing to the commodity markets.”

Allegro Development

Offering solutions to risk managers enabling them to understand the impact of incremental positions on a portfolio