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8/6/2019 Algorithmics Algo BR00708 RiskServiceOView
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ALGO
RISK SERVICE
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GET CONNECTED TO ANOUTSOURCED, WEB-BASED
SERVICE WITH UNMATCHEDINSTRUMENT COVERAGEFOR THE BUY SIDE.
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LEADING-EDGE RISK ANDPORTFOLIO ANALYTICS,
CONFIGURED TO THEUNIQUE NEEDS OF YOURINVESTMENT UNIVERSE.
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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.
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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
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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.
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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.
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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
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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
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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
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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