algorithmics algo br00708 riskserviceoview

8/6/2019 Algorithmics Algo BR00708 RiskServiceOView

1/16

ALGO

RISK SERVICE


2/16

GET CONNECTED TO ANOUTSOURCED, WEB-BASED

SERVICE WITH UNMATCHEDINSTRUMENT COVERAGEFOR THE BUY SIDE.


3/16


4/16

LEADING-EDGE RISK ANDPORTFOLIO ANALYTICS,

CONFIGURED TO THEUNIQUE NEEDS OF YOURINVESTMENT UNIVERSE.


5/16

Algo Risk Service is a web-based portfolio

construction and risk management service

designed for buy-side organizations, trading

desks, and corporate treasuries. Hosted by

Algorithmics and delivered online, the service

provides access to sophisticated risk

management and investment support tools,

without the data, personnel, and hardware

costs of maintaining an in-house deployment.

As a managed service, Algo Risk Service

provides a dedicated data and production

environment, delivered online, which is uniquely

configured to address each clients specific

business requirements. All data management,model configuration, and application support is

provided by a dedicated Algorithmics team of

client engagement specialists.


6/16


7/16

ALGO RISK SERVICE OFFERS:

Unrivalled Coverage

Drawing upon Algorithmics 20 years of experience and investment in financialengineering, Algo Risk Service offers industry-leading coverage across risk factors,

asset classes, and investment strategies within a simulation framework based on

full-forward valuation. The service provides an extensive range of portfolio analytics,

risk measures, valuation models, and optimization techniques, calculated on both an

absolute and relative basis, thereby covering all of an organizations long-only and

long-short investment strategies in a single, theoretically-consistent manner.

Superior FlexibilityAlgo Risk Service offers organizations the flexibility to choose the analytic measures,

valuation models, market data, and reporting options most appropriate to theirunique risk and portfolio construction requirements. Unlike standard ASP

approaches, the managed service provides each organization with a dedicated

production environment, implementation team, and relationship manager, thereby

offering the level of data and configuration flexibility normally associated with an

in-house implementation.

Advanced UsabilityAlgo Risk Service provides access to interactive diagnosis, what-if capability, drill

down, and attribution analysis across a virtually unlimited range of risk factor and

grouping dimensions, going far beyond the provision of static risk reports. Through its

intuitive navigation and a dynamic, highly interactive user interface, the service helps

organizations acquire on-demand access to inquiries. From portfolio managers to risk

managers, individual users within an organization can organize the workbench

environment to meet their own unique analytical and ergonomic needs. All

functionalities, tools and reporting templates can be surfaced or hidden depending

on the specific task at hand.

Exposure report e.g., for a long-short strategy, shows interactive concentration analysis


8/16

Award-winning risktechnology

Judges chose Algo Risk Service as

the Best Buy-Side Risk/Portfolio

Analytics Product in the 2008

Buy-Side Technology Awards.

Their unanimous decision took

into account the breadth of Algo

Risk Service's asset coverage,flexibility, usability, and

testimonials from clients.


9/16

Interest rate report e.g., shows desk level portfolio analytics, contribution measures

Tracking error report e.g., shows what-if risk and return relative to a benchmark

FEATURES AND BENEFITS

Algo Risk Service integrates front- and middle-office requirements to help provide

a consistent view of risk throughout the organization. All risk analytics and portfolio

construction capabilities leverage a single simulation environment, while theconfigurable interface supports the workflow needs of multiple groups with key

functional and service-based advantages.


10/16


11/16

KEY FUNCTIONAL ADVANTAGES INCLUDE:

Comprehensive investment strategy supportAlgo Risk Service supports all long-short and long-only investment strategies,

spanning any real or virtual portfolio structure. Risk and return measures can be

calculated on an absolute basis or with respect to a portfolios active exposure, relative

to multiple standard or user-defined benchmarks.

Extensive risk analyticsAlgo Risk Service offers an extensive array of analytical and simulation-based risk

methodologies, including key-rate, beta and sensitivity measures; user-defined stress

testing and event analysis; and distributional measures such as VaR, tracking error,

and expected tail loss.

Flexible risk diagnosticsAll risk measures are calculated at the enterprise and portfolio levels with full drill down

to the individual security level, or to the level of any user-defined group, including asset

class, currency, industry sector, issuer, credit rating, P/E ratio, and duration bucket.

Thorough risk identificationAlgo Risk Service calculates portfolio or security risk measures on both a stand-alone

basis or with respect to their contribution to parent level portfolios, while also

providing full risk decomposition by criteria such as risk factor attribution and asset

allocation vs. security selection.

Proven portfolio modeling toolsAlgo Risk Service supports an interactive portfolio construction workbench with

a wide range of portfolio modeling tools, which enable the comparison of potential

investment strategies. The toolset includes what-if analyses, best hedges, portfolio

optimization, portfolio replication, and efficient frontier analysis.

Optimization workbench e.g., efficient frontier portfolios of return against tracking error


12/16


13/16

KEY SERVICE ADVANTAGES INCLUDE:

Stringent service levelsAlgo Risk Service provides precise service level agreements (SLA) that exceed industry

standards, ensure reliable uptime commitments, and guarantee rapid response times.

The SLAs provide a clearly defined change request process and offer transparent

service escalation procedures.

Robust data managementThrough well-defined data retrieval processes and data validation procedures, Algo

Risk Service provides a robust data management framework where data is processed,

monitored, and validated each time data is retrieved. Analytical testing, statistical

analysis, and screening techniques are used to ensure that day-over-day valuation

deviations are reasonably bounded.

Client data securityEach Algo Risk Service client is assigned its own secure production data environment,

ensuring that no misappropriation of client data takes place. In addition to isolating

and securing all of a client's input and result data, transfers to and from the

production center are encrypted to further protect data security.

Financial engineering and model validation supportAs the basis for its risk and portfolio analytics, Algo Risk Service provides model-based

valuations and analytic sensitivities across all asset classes, including complexderivatives and structured products, which are modeled and validated by

Algorithmics' financial engineers to ensure accuracy and consistency.

Multiple market data optionsAlgo Risk Service produces valuations, risk measures, and portfolio analytics based on

a standard market data offering that may be augmented or replaced with a client's

proprietary data, or through data loaders that seamlessly support other third-party

market data providers via an agency arrangement.

Value at risk report e.g., shows VaR, VaR attribution and VaR contribution across portfolios


14/16

WHO BENEFITS FROM ALGO RISK SERVICE?Algo Risk Service addresses the requirements of both the front and middle offices

by leveraging a single, integrated risk framework. Designed to simultaneously meet

the needs of risk managers, portfolio managers, traders, and quantitative analysts,

Algo Risk Service provides a robust risk management and portfolio construction

environment to monitor, manage, and optimize risk across all asset classes and

investment strategies.

TradersAlgo Risk Service provides traders with the tools to evaluate the tactical

implementation of a portfolio strategy. Traders gain access to functionality that

provides impact analysis of possible trades, extensive what-if functionality, limit

monitoring, risk measures at the position, portfolio or group level, and the ability

to put in place effective hedging strategies to mitigate risk.

Portfolio ManagersAlgo Risk Service provides an interactive strategy workbench for risk assessment

and portfolio construction purposes. This workflow environment enables portfolio

managers to efficiently and transparently embed risk into the core of their investment

and risk budgeting process with extensive optimization and what-if functionality to

maximize risk-adjusted performance.

Risk ManagersAlgo Risk Service enables risk managers to assess the risk of an individual portfolio

or the consolidated risk of multiple portfolios and/or portfolio hierarchies across the

organization. The underlying scenario-based methodology provides multiple risk

perspectives across all risk factors, asset classes, and investment strategies, resulting

in a robust, consistent, and meaningful view of risk exposure.

Stress test e.g., replays market events occurring during the Asian crisis on todays

holdings


15/16


16/16

2008 Algorithmics Incorporated. All rights reserved. ALGO, ALGORITHMICS, AI & Design,

ALGORITHMICS AI & Design, KNOW YOUR RISK, MARK-TO-FUTURE, RISKWATCH, ALGO CAPITAL,

ALGO COLLATERAL, ALGO CREDIT, ALGO MARKET, ALGO OPVANTAGE, ALGO OPVANTAGE FIRST,

ALGO RISK, ALGO RISK SERVICE, and ALGO SUITE are trademarks of Algorithmics Trademarks LLC.

SOL-AR-0011 (1 11/08)

About Algorithmics

www.algorithmics.com

algorithmics algo br00708 riskserviceoview

Documents