Building a cutting-edge risk management system for a volatile world: introducing RiskSmart X

The world is changing. Seismic risk events that would once have occurred over the course of a decade can now happen within a year. Risk management teams working at the world’s most sophisticated trading firms have had their work cut out with multiple crisis events occurring across asset classes – from bond market blow-ups to bear markets and crypto busts, to name a few.

A consequence of the new, rapidly changing risk environment has been a scramble for the right tools to shine a light on exposures and to identify potential market hazards before they happen. Risk managers responsible for the exposure of the world’s most sophisticated investors need to be able to see and assess risks across asset classes, in real time. Being without them is like driving without headlights on a dark and icy road – not only careless but highly dangerous.

Having worked for many years in prime brokerage, I know first-hand the pressures that risk professionals at prime brokers face. Operating on the front line in challenging markets without the right tools can be a punishing experience, particularly when dealing with disparate teams, systems and asset classes. Without a comprehensive view of exposures, risk teams may as well be flying blind.

For a long time, the market has needed a faster, more in-depth, far-reaching and powerful risk system. Out of this demand, the concept of RiskSmart X was born: a best-in-class system allowing clients to manage exposure and navigate markets in any condition – in real time – helping to make better decisions with cutting edge risk analytics. The resulting system is a product of our heritage, deeply rooted in the most advanced risk management technology, and a team that has worked on the ground for risk teams, buy-side firms and banks, who understand exactly what is needed to navigate risk in the toughest environments.

From my years in prime brokerage, the most sophisticated risk systems typically remained the preserve of organizations with armies of risk personnel working around the clock, but out of reach for nimble prime brokers without huge budgets and headcount. RiskSmart X changes this – giving firms a dynamic and highly advanced risk solution, straight out the box – and provides ambitious prime brokers with similar risk capabilities to the giants of the industry. To achieve this, RiskSmart X delivers:

• Real time risk analysis: Processing vast swathes of data to deliver a clear view of exposures as they occur. Market dislocations can take seconds, not days – risk management systems need to reflect this to stand a chance.
• Multi-asset coverage: The days of single asset class desks are fading, making way for leaner multi-asset desks able to handle several asset classes at once. This adds another layer of complexity when it comes to risk, which is why RiskSmart X is built to give a single view of exposures across asset classes – helping busy desks to keep their many plates spinning safely.
• Historic modelling: Behind the technology are highly sophisticated, battle-tested models. As important as the technology delivering live analytics are the brightest minds developing highly complex financial models to keep sophisticated investment firms on track. TS Imagine’s decades of experience, modelling and navigating crises, have resulted in robust models that have stood the test of time and allow users to stress test a variety of scenarios with confidence.
• Constant evolution: Risk does not stand still – neither do we. Through RiskSmart X, we act as an extension of our clients’ teams – continuously tweaking our models with over 50 dedicated professionals feeding the system with reference, derived, security master and pricing data to ensure the solution remains on the leading edge.
• Scalability: Sophisticated investors are ambitious and hungry for growth. RiskSmart X is designed to grow with a business, removing the need for cumbersome expansions to fill gaps as the business expands.

RiskSmart X is a game changer. While the basis of good risk management has remained the same – smart people building highly complex models to keep desks one step ahead – technology has taken capabilities beyond what was conceivable only a few years ago. RiskSmart X is a result of the best talent and technology combined and delivered by a business that has been serving the most sophisticated investors for over 30 years.

There are rarely second chances in markets. As the risk environment intensifies, RiskSmart X is the powerful engine sophisticated investors need to safely navigate tough conditions and sail them to a more prosperous future.

About the Author

Thomas Benevento is the Head of Product for RiskSmart X at TS Imagine. For two decades, Thomas has worked in the prime brokerage industry, focused on client management and product development.

Thomas has hands-on experience leading prime brokerage teams, across asset classes. He spent over 10 years at Deutsche Bank, where he led cash and synthetic client management teams that serviced some of the most sophisticated and complex hedge funds in the world.

Thomas also led business development and customer experience as part of a financial technology firm providing third-party technology to prime brokerage firms.

Thomas graduated from the University of Richmond where he earned a BSBA in Finance.