Risk management is a term that is regularly used inappropriately. Understanding risk and having robust risk control management systems and processes is vital for any trading business. Smart Global are experts in the analysis of risk and in risk management and control systems. We advise on and implement risk control systems and procedures as well as carrying out "MOT's" for existing businesses.
Various failures in control have become public over the last few years in financial markets, with catastrophic impacts for results and reputations. Smart Global works with clients to ensure that they avoid even small breaches.
It is essential to set appropriate risk limits, both volumetric and MVaR based, and to ensure all staff understand them. Additionally management procedures, decision criteria, escalation and intervention procedures must be clearly defined and documented. Achieving this relies on having the right deal management structure within the ETRM system so that all related trades can be grouped together and understood, and data can be interrogated and reported on across time, geography, grade and instrument type.