A system, method, software, and portfolios for managing risk in markets
relating to a commodity delivered over a network are described, in which
a market participant constructs portfolios of preferably liquid price
risk instruments in proportions that eliminate the Spatial Price Risk for
the market participant's underlying position. Techniques are also
disclosed for constructing and evaluating new price risk instruments and
other sets of positions, as well as identifying arbitrage opportunities
in those markets.