riskaware - Benefits

For Hedge Funds:

  • Portfolio optimization & Risk management: The model is instrumental to compare investments from a risk-return perspective and to enhance the risk adjusted yield potential of the portfolio.

  • Identifying mispriced assets on the market: Creates an edge in bond pricing.

  • Relative value trading strategy: By applying a long-short trading strategy uncertainty within the macro assumptions of the model can be mitigated which allows the portfolio manager to benefit more efficiently from the main value created by the model, single name credit analysis and pricing.

For Banks:

  • The model connects macro expectation to company level performance and calculates the effects of any future macro-economic scenario
  • Makes monitoring and stress-testing of individual loans and the portfolio easy
  • The software calculates PD & LGD ratios individually for each facilities and builds up the credit risk profile of the portfolio in a single worksheet
  • Strengthens portfolio approach, improves management information and supports provisioning decisions
  • The model minimises loss of information in the calculation (considers idiosyncratic factors and actual macro expectations)
  • Measures credit risk precisely
  • The methodology is dynamic, forward-looking and cash-flow based
  • The software can calculate Expected Loss ratios without histories of PD & LGD data

Improving Portfolio Management: Stress Testing and Monitoring

RISKAWARE is capable of running user-defined stress test cases for the whole portfolio by applying different expectations about GDP growth, Inflation, FX Rates and Sovereign Bond Yields. By updating the macroeconomic assumptions of the model RISKAWARE helps managers to stay on top of the portfolio and identify risk concentrations on a client, group or sector basis.

Providing an Integrated Risk Management Solution

RISKAWARE provides an integrated solution equipped with next-generation technology to enhance the measuring, handling and administering of credit risk. It connects and administers credit analysis and credit approval & rating processes with portfolio management, which will improve consistency and raise awareness at risk management.

methodology1
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methodology1
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