Alerts Direct Core Uses

Alerts Direct conducts real-time risk assessment and monitoring for a client's proprietary and customer business in 3 key areas:

Margin requirement against collateral held:

Margin is the most complex calculation in any risk management system. Calculation of initial margin on an account or group basis is required every time a new trade enters the back office system. Rolfe & Nolan’s powerful new margin engine is integrated within the Alerts Direct system, to guarantee the accurate sub-second calculation of margin using instrument and exchange-specific algorithms and dynamic static data. Margin required is compared against the value of cash and collateral held. Limits can then be set on an account or group basis by the risk management team.

Impact of price changes

The net liquidating value (net equity) is calculated fast and accurately by passing an account/group's portfolio to the Rolfe & Nolan margin engine for valuation.  Using real-time or exchange-delivered settlement prices, the portfolio's net liquidating value is calculated.  This calculation identifies the impact of a price change on a portfolio.  As with margin monitoring (see above), the user's risk team can set 'medium' and 'high' valuation limit levels on an account/group basis.

Lot limits

This calculation is based on the net position size, either on a product, exchange, or overall basis, and alerts the risk manager if an account/group exceed their authorised limits.  Lot limit monitoring also delivers the ability to monitor over-trading outside the front office deal capture system - which may not have the ability to detect the build-up of a position in incremental clips - or have access to give-in trades executed via another broker.

The diagram below shows the client and solution structure of Alerts Direct.  To view the diagram larger please click on the image.