HEDGIT is a mobile application for smartphones, functional for Android and iOS, which allows you to automate grain pricing process.
HEDGIT works under the service of subscriptions to sales programs, which automate pricing through algorithms. Once the application is installed, you will be able to subscribe to specific sales programs for each product.
In an initial stage, we have pricing products for Soybean May 2023 and Soybean November 2023, in Argentina. We will gradually incorporate products that allow us to automate the sale of various agricultural products, in multiple geographies.
The application can be installed on any smartphone from our website, by entering HEDGIT.AI from the device's browser. Locate the button that says “REQUEST DEMO” and follow the instructions.
An algorithm is a set of defined instructions to solve a problem or achieve an end. Artificial intelligence, applied to making specific decisions, uses algorithms as optimization and automation vehicles.
Our algorithms help growers hedge their market risk by automating the pricing decision-making process. All of our products are mathematically optimized and back-tested out of sample.
Our algorithms are statistically optimized to achieve a high degree of future performance. However, since markets show changing patterns all the time, no algorithm is flawless and they are always subject to some probability of underperformance. However, even in scenarios of volatility that are impossible to foresee, the degree of error of an algorithm is considerably lower than the one involving human decision-making.
Once the app is installed, you will be able to access the algorithms library by clicking on the ALGORITHMS tab, in the lower menu, in the center.
Access the algorithm library by clicking on the ALGORITHMS tab, in the bottom menu, in the center. Each algorithm shows a brief description of the product and the date on which it operates. Once you have selected the algorithm of your choice, click on the VIEW button to enter its details. Below the algorithm specifications and the past performance graph you will find the SUBSCRIBE button. If you are interested in starting a PRICING PROGRAM using this algorithm, click on SUBSCRIBE and enter the volume you want to price. Then select the EXECUTION PARTNER (XP) and finally click on continue. The request will be entered and validated by the EXECUTION PARTNER as soon as possible.
Pricing algorithms will gradually be incorporated into the flow of services. For the 22/23 campaign, only two algorithms will be available:
FINE TUNER FOR SOY MAY 23*, with November-April pricing window, and
FINE TUNER NOVEMBER 23**, with pricing window April-October
The Fine tuner matches the 6-month market price average using only 5 pricing signals. Statistically, it has more than a 90% chance of approximating the 6-month average market price in a range of +/-2%.
*Reference market: Position SOYA MAY 2023 ROSARIO in MATBA-ROFEX. 5 pricing signals.
**Reference market: SOY NOVEMBER 2023 ROSARIO position in MATBA-ROFEX. 5 pricing signals.
A PRICING PROGRAM is an orderly pricing plan for a particular product. Each subscription to an ALGORITHM initiates a PRICING PROGRAM.
To start a Pricing program it is necessary to subscribe to an algorithm.
Our pricing programs can be subscribed for multiple volumes of 500 tons, without a stipulated maximum. Subscribed volume must have an execution partner assigned (XP – execution partner).
Every subscription to an algorithm and active pricing program must have an XP (execution partner) assigned. The role of the XP is to execute the pricing signals that are generated by the algorithms in each pricing program. Our XPs are recognized members of the agricultural value chain, with a proven track record in grain marketing execution.
The monitoring interface of PRICING PROGRAMS allows a complete follow-up of the pricing process.
By clicking on each PRICING PROGRAM listed in the PRICING PROGRAMS menu, you access the monitoring interface, where you can see the PERFORMANCE of the pricing process compared to market evolution..
The monitoring interface shows an integrated dashboard of the PRICING PROGRAM and the evolution of the market. Two types of price can be compared in it: the BENCHMARK PRICE and the EXECUTION PRICE, both presented in scale with a MARKET GAUGE, showing the maximum and minimum prices observed at the moment.
To the right of the MARKET GAUGE, the monitoring interface will also display the hedging ratio of the PRICING PROGRAM.
To simplify the performance analysis, the monitoring interface also presents a chart view below the MARKET GAUGE, where the evolution of the market and the PRICING SIGNALS can be seen together, the latter highlighted with black circles.
Finally, all the PRICING SIGNALS registered at the time of monitoring will be displayed below the CHART VIEW, with their respective reference levels and issue dates.
The BENCHMARK PRICE is the registered price of PRICING SIGNAL, equivalent to the closing price of the BENCHMARK MARKET, on the day the signal was generated and notified.
The EXECUTION PRICE is the price at which an XP executes a PRICING SIGNAL, either in the BENCHMARK MARKET or in the EXECUTION MARKET.
Our ALGORITHMS periodically monitor BENCHMARK MARKETS and generate pricing signals according to patterns observed in their price dynamics. A benchmark market, commonly called “UNDERLYING”, can be a position in a Futures Market or a quote from any other organized market.
The MARKET GAUGE enables relative performance comparison of the PRICING PROGRAM vs the market evolution. The gauge extremes are the minimum and maximum prices observed in the pricing window at the time of monitoring. The position in which the benchmark and execution prices are located will give a quick perspective of how well the pricing is working with respect to the evolution of the market.
The HEDGING RATIO shows the PRICING PROGRAM evolution in percentage terms. If the ratio is at 100%, it means that all pricing signals have already been signaled. Each pricing signal represents a fixed percentage of the total program, consisting of dividing 100% by the number of pricing signals provided by the program. For example: if a PRICING PROGRAM generates 5 signals, each signal will represent 20% of the program.
The CHART VIEW of the PRICING PROGRAM enables users to see PRICING PERFORMANCE in relative terms to the MARKET EVOLUTION. The pricing window can be enlarged or reduced to change the perspective. Similarly, PRICING SIGNALS are also plotted in detail with precise references to price levels and issue dates.
Our ALGORITHMS periodically monitor BENCHMARK MARKETS and issue PRICING SIGNALS, which are subsequently executed by the XP.
The Signals interface allows users to monitor all the pricing signals issued by the subscribed algorithms. Every signal emitted and executed by the XP will appear in the left flap of the interface, while every signal emitted but pending execution will appear in the right flap.
The interface is accessed by clicking on SIGNALS, in the lower menu, on the left.
PRICING SIGNALS are notified in the morning via SMS and registered in the SIGNALS interface of the application.
A PENDING SIGNAL is a pricing signal issued by the ALGORITHM that has not yet been executed by an XP.
An EXECUTED SIGNAL is a pricing signal issued by the ALGORITHM and executed by the XP.
Pricing signals are notified by the system in the morning, before the opening of the market, and executed during the day by the XP, according to the preferences of the subscribers.
Any pricing signal issued during the morning will be registered by the system at the closing price of the BENCHMARK MARKET that same day.
The EXECUTION PRICE will be registered in the system by the XP, once the signal has been executed in the BENCHMARK MARKET.
Our ALGORITHMS emit pricing signals on liquid and transparent BENCHMARK MARKETS, so we recommend using them to implement the execution of the PRICING PROGRAMS. However, we know that each grower has different realities and that their logistics and market preferences may vary when it comes to executing pricing signals.
HEDGIT has been designed so that the functionality of the ALGORITHMS is not affected by the execution preferences of the end users, providing flexibility to the pricing process.That´s why every signal emitted by our ALGORITHMS registers two different prices: a BENCHMARK PRICE and an EXECUTION PRICE.