Saturday, June 15, 2024

Numerix: Dynamic Risk Analysis and Cross-Asset Evaluation

Steven O’Hanlon, CEO & President

Financial institutions are bound by stringent regulations that are constantly changed to improve security. These changes by the regulatory bodies restrict these institutions from bringing out innovative and new policies for their customers. This affects their ability to be profitable and also their competitiveness. Numerix helps financial institutions by providing them cross-asset pricing and risk solutions for structuring, pre-trade price discovery, trade capture, valuation and portfolio management of derivatives and structured products. Numerix has emerged as a pioneer in the market of derivatives risk management and has carved itself a niche as cross-asset analyser.

Numerix expertly assists clients in solving their complicated quantitative, business and compliance problems. Their services include capital markets and insurance offerings— from model validation, risk advisory and curve construction to regulatory reporting. Their cutting-edge analytics platform produces calculated pricing and risk predictions for OTC structured products and derivatives—across all assets: fixed income, equity, FX, credit, commodities, inflation, volatility and hybrids.  Numerix analytics solutions helps global financial institutions and insurance institutions to understand performance, analyse and anticipate future derivatives risks with unparalleled speed and accuracy. Insurance solutions are also available through the Numerix Leading Hedge Product suite, which provides the tools to manage and hedge complex life and annuity products and investment portfolios.

Numerix CrossAsset is a flexible and transparent framework that is available to use across platforms. It can be easily integrated into Microsoft Excel as an add-on and into proprietary or third-party systems via the Numerix Cross-Asset Integration Layer and SDK in C#, C++, or Java. Numerix CrossAsset Platform is able to provide the full range of counterparty exposure measures such as PFE, EE, EPE & ENE, as well as XVA pricing adjustments – CVA, DVA and FVA. This also includes market risk capabilities, stress testing and scenario generation.

Their analytic server is designed to rapidly deploy pricing and risk analytics- ranging from market risk predictions, credit risk, confirming results (stress testing, back testing), limit surveillance, scenario generation and exhaustive reporting. This is achieved by leveraging a discrete grid architecture, online database, OLAP averaging , limits and analysis algorithms. A dashboard UI provides clients a framework to manage the core services.

Numerix also offers tailor-made insurance solutions. These are built on an exhaustive model library and help life and annuity businesses maintain profitability, capital, risk and regulatory compliance. Numerix offers advanced analytics for structuring and managing all derivatives and structured products. It has the Industry’s most extensive and sophisticated collection library of cross-asset models and methods. Numerix unique hybrid model framework enables the production of consistent scenarios among multiple risk factors, which is critical to producing robust CVA calculations. It uses the highly efficient American Monte Carlo model (using the same set of paths for both market scenarios and prices, eliminating the need for a ‘Monte Carlo-on-Monte Carlo’ computation.) making intraday Credit Valuation Adjustments computations a streamlined reality. Their platform boasts of a Object-oriented architecture, flexible payoff scripting language and broad asset-class coverage.

With unique services and solutions, extensive implementation experience and partnerships with global trading system and risk vendors and continued investment in innovative technologies, unrivalled analytic capabilities, and a customer-centric solution selling approach, the company has been firmly planted as the most prolific and dominant leader in both risk and pricing.