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Integrated Derivatives Analytics: Accelerate Your Time to Market and Reduce Development Costs

Integrated Derivatives Analytics: Accelerate Your Time to Market and Reduce Development Costs






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  • Well Susan I think that using third party derivative pricing analytics can be very helpful for system vendors looking to meet the types of needs described by Celent in the previous slides. As Cubillas mentioned, with derivative pricing and risk analytics being the proverbial “hotspots” and now receiving increased focus by financial institutions - Some of the biggest challenges facing system vendors is to Keep pace with this constantly evolving derivative valuation need and processing capability required by clients – especially as they begin trading new derivative instruments or use them to hedge their risk… Then there is keeping pace with Regulatory requirements as demanded by clients looking to comply with– FAS, IASB, IFRS, SOX etc - And provide the standardization and transparency that clients now require – especially the need for independent valuation and transparency And to top it all – all this needs to be done in both quickly and cost effectively….
  • So in In many ways that’s where Third Party providers of derivative analytics help The most obvious reasons to integrate applications with a 3rd Party provider of Analytics is to have access to trusted derivative pricing and risk analytics that can be easily integrated to meet your clients needs quickly & cost effectively. ::And we all wish it was just that simple!Undoubtedly though - working with best of breed providers of derivative pricing analytics certainly has advantages. They can help:Accelerate your time to Market: As working with providers of Industry standard analytics helps mitigate model and methodology risk especially if your organization’s core competence does not revolve around researching and implementing financial models. Using a third party provider can help cover any gaps in derivative instrument coverage relatively easily - Thereby drastically improving speed to market especially in a highly competitive environment – where clients don’t seem bound to application types or specific vendors to meet their valuation needs.They can help you Stay Current with your clients evolving needs: In addition to helping you meet the derivative coverage needs of you clients - they become critical for implementations of conventions required by regulatory mandates as they come into being . A very recent example of this has been the ISDA mandated methodology to value CDS contracts. Having access to a trusted analytics providers focused on the provision of analytics helps meet such needs quickly and cost effectively. And as the Celent Report mentioned earlier Disclosure and valuation practices are crucial for restoring market confidence. That’s what clients are focused on especially in today’s environment ...and now more than ever.. Financial Institutions are required to have Confidence in the data and assumptions for their valuation methodologies and Confidence in the financial models used by these methodologiesThat’s where industry standard analytics play a huge role..because they can help provide a transparent derivative valuation solution giving you the ability to provide the documentation necessary to help your clients satisfy various regulatory compliance requirements especially as they relate to valuation methodologies in support of the numbers produced by your solutions. And valuations produced by best of breed providers of analytics are trusted and recognized by your clients and their auditors And finally …A third party derivative solution can save you many many man hours of development, QA and research time –- Especially, if the development of derivative pricing analytics is not your core competence, as I mentioned earlier.SD: So Jack what solutions does FINCAD provide to help system vendors or service providers to help their clients? JM is head of Product Management at FINCADJM: