Technology

• Overview
• Risk Ticker
• Risk Ticker Factory
• Methodology

Risk Ticker

Riskdata offers an innovative paradigm aimed at representing the risk of individual instruments or market risk factors in a compact yet complete and easy to manipulate manner. The basic element of Riskdata's paradigm is the Risk Ticker®, a data object representing a single risk factor or instrument.

Each Risk Ticker contains all the statistical information of the instrument or risk factor it represents, that is, its distribution of returns, as well as its joint behaviour with respect to other factors such as correlation, convexity, etc...

All Riskdata's clients have on line access to a comprehensive set of Risk Tickers , produced by the central Risk Ticker Factory, covering all asset classes: equities, fixed-incomes, currencies and derivatives

The strength of the Riskdata's paradigm relies on the straightforward correspondence between "pricing arithmetic" and "Risk Ticker arithmetic". For instance, given the Risk Tickers of components of a portfolio and the positions on these components, the "portfolio Risk Ticker" is obtained by adding-up the component Risk Tickers, weighted according to the positions.

These features offer breakthrough possibilities in terms of:

• Instrument coverage: all instruments, whatever their complexity, can be represented by a Risk Ticker. Global consistency is ensured across all markets.
• Risk consolidation: because they behave like prices, Risk Tickers make risk consolidation as simple as price aggregation, and avoid complex positions database duplication.
• Automation: it is as easy as interfacing a market price data feed.

“Much of what distinguishes modern economies from those of the past is the new ability to identify risk, to measure it, to appreciate its consequences, and to take action accordingly.”

Michel Crouhy, Dan Galai, and Robert Mark
The Essentials of Risk Management