Stock up your collateral larder, says SunGard
28 June 2013 London
Image: Shutterstock
Establishing a global inventory is a vital first step down the road to collateral optimisation, said SunGard in a recent whitepaper.
Authored by Ted Allen and Ed Hellaby, the paper admits that while inventory management is important, it’s rare to find information about a pragmatic approach to how to make the next step and institutionalise a collateral optimisation programme.
“One of the reasons we have had such little industry press activity focus on the ‘how’ is because optimisation is an unknown domain for many collateral practitioners,” said the paper.
The approach undertaken by many in the past has been manually intensive and usually involved ranking assets based on a firm’s preference and a waterfall allocation to requirements.
“However, in a world of increasing collateral requirements and a larger number of collateral pools, the process of optimisation becomes one that increases in complexity as volumes grow.”
The paper explains different optimisation cost models, and collateral allocation methods.
Authored by Ted Allen and Ed Hellaby, the paper admits that while inventory management is important, it’s rare to find information about a pragmatic approach to how to make the next step and institutionalise a collateral optimisation programme.
“One of the reasons we have had such little industry press activity focus on the ‘how’ is because optimisation is an unknown domain for many collateral practitioners,” said the paper.
The approach undertaken by many in the past has been manually intensive and usually involved ranking assets based on a firm’s preference and a waterfall allocation to requirements.
“However, in a world of increasing collateral requirements and a larger number of collateral pools, the process of optimisation becomes one that increases in complexity as volumes grow.”
The paper explains different optimisation cost models, and collateral allocation methods.
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