A flexible investment risk management system

Our mid-sized hedge fund was frustrated with their black-box investment risk management system. Their existing portfolio risk analytics platform was not only missing granular details of stress test sensitivities but they would come up against unreliable batch processing and slow risk calculations. These limitations hindered their ability to make informed investment decisions swiftly.

What they needed was a more advanced investment risk management system that could handle their sophisticated alternative strategies. They were looking to replace their existing solution with one that could provide timely and responsive risk analytics. And ideally, they wanted something that could seamlessly integrate with their current technology stack.

The solution: Axioma Risk

Axioma Risk provided the hedge fund the flexibility to calculate the desired portfolio risk analytics using a wide range of risk measurement tools.

The specific features the client was interested in included:

• On-the-fly transitive stress tests: Enables quick assessments of potential risk scenarios
• Pre-trade ‘what-if’ analyses: Allows proactive risk management before executing trades
• Market risk calibration: Specifically tailored merger arbitrage strategies
• Business intelligence dashboards: Helps visualize risk drivers, allowing timely adjustments to optimize investment outcomes

The integrable investment risk management system

The hedge fund was already an existing user of some of our solutions including Axioma Portfolio Optimizer (portfolio construction), Axioma Portfolio Analytics (performance attribution and reporting) and Axioma Risk Model Machine (risk model customization). This made it easy for Axioma Risk to connect their entire investment management technology stack. This integration, including OPERA regulatory reporting via our APIs, ensured consistency and interoperability across their investment workflow.

Benefitting from the entire incisive portfolio risk analytics service

• High touch support: Our product specialist teams offer support from pre-integration to post-sales, with 24/6 operational assistance
• Seamless integration: Our API-first technology combined with a cloud-native portfolio risk management platform ensures flexible, scalable, and cost-efficient delivery.

By choosing Axioma Risk, hedge funds can achieve a superior level of investment risk management, enabling them to navigate complex financial markets with confidence.