ProductsRisk SuiteIndex Decomposition
REDUCE SIMM COSTS WITH ONE SIMPLE CHANGE

IM Risk Generator: Index Decomposition

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BOOK A MEETING
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We decompose your index trades

IM Risk Generator has the capability to decompose index-based trades allowing them to be represented as sensitivities to the underlying components rather than the index itself. Using decomposition typically reduces the costs of margin because the decomposed representation carries a lower risk weight. On top of this the potential natural hedging between underlying components and the rest of the portfolio can create additional savings

ProductsRisk SuiteIndex Decomposition
REDUCE SIMM COSTS WITH ONE SIMPLE CHANGE

IM Risk Generator: Index Decomposition

BOOK A MEETING
Chevron Icon

We decompose your index trades

IM Risk Generator has the capability to decompose index-based trades allowing them to be represented as sensitivities to the underlying components rather than the index itself. Using decomposition typically reduces the costs of margin because the decomposed representation carries a lower risk weight. On top of this the potential natural hedging between underlying components and the rest of the portfolio can create additional savings

Changing to the decomposition method is simple and straightforward requiring no change in data submission. Because Acadia has access to dozens of common indexes a firm simply needs to confirm which indexes they would like decomposed and Acadia can enable the functionality.

Decomposition has been shown to be able to reduce SIMM exposure by between 30 and 50%. The actual reduction will depend on specifics of the portfolio.

Acadia can provide a calculation of the potential benefit so that firms can estimate an accurate ROI of making the change.

Reduction in SIMM with no additional effort

IM Risk Generator has the capability to decompose index-based trades allowing them to be represented as sensitivities to the underlying components rather than the index itself. Using decomposition typically reduces the costs of margin because the decomposed representation carries a lower risk weight. On top of this the potential natural hedging between underlying components and the rest of the portfolio can create additional savings

Changing to the decomposition method is simple and straightforward requiring no change in data submission. Because Acadia has access to dozens of common indexes a firm simply needs to confirm which indexes they would like decomposed and Acadia can enable the functionality.

Decomposition has been shown to be able to reduce SIMM exposure by between 30 and 50%. The actual reduction will depend on specifics of the portfolio.

Acadia can provide a calculation of the potential benefit so that firms can estimate an accurate ROI of making the change.

Proud winners of FTF Awards Best Compliance Solution 2022

Reduce SIMM costs through decomposition

Use existing configurations and data integration

Seamless change with no new integration work required

Access to a range of common public and proprietary indexes

*figures quoted based on LIKEZERO data

KEY BENEFITS

Reduce SIMM costs through decomposition

Use existing configurations and data integration

Seamless change with no new integration work required

Access to a range of common public and proprietary indexes

KEY BENEFITS

1.

Reduce SIMM costs through decomposition

Explore Digitization >

2.

Use existing configurations and data integration

Explore Agreement Manager >

3.

Seamless change with no new integration work required

View Factsheet >

4.

Access to a range of common public and proprietary indexes

View Factsheet >

5.

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Book a meeting with our team to learn more about Index Decomposition

Driving the derivatives industry as one

We offer more than just Index Decomposition. Find out what Acadia solutions can offer your business and drive it forward across departments.

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