Kinetic Partners, the professional services firm focused exclusively on the asset management industry, has launched its Risk and Valuation Services (RVS), a leading new service that can deliver risk services for funds in one seamless process, to help both traditional and alternative managers implement robust and effective risk management systems.
The global financial crisis exposed significant weaknesses in the risk management practices of many funds. Investors and regulators are now demanding that funds implement far stronger risk management processes. Their concerns are illustrated by the EUs inclusion of requirements for funds to provide far better risk management reporting in the UCITS IV Directive and the draft Alternative Investment Fund Management (AIFM) Directive.
In addition to performance attribution, VaR analysis and stress testing, regulators want funds to address specific issues, such as OTC valuation, liquidity, leverage and counterparty risk, all areas which were exposed as being inadequately monitored during the recent global financial crisis.
Such regulatory pressure and investor expectations have put asset managers under increasing pressure to employ appropriate technology tools. For fund managers to implement a framework and system internally to meet these needs would be expensive and may lack the credibility of an independent third-party carrying out the assessment.
Kinetic Partners Risk and Valuation Services (RVS) provides fund managers with a total outsourced risk management solution that meets regulators and investors demands. It assesses all risks faced by funds in one seamless process.
RVS combines technical and industry expertise, the experience and ability to provide the necessary services and supporting technology for current and anticipated needs. The central engine behind RVS is Kinetic Partners tailored Portfolio and Risk Management System (PMS) that covers all relevant risk areas for fund managers including:
Market risk (VaR, stress testing and back testing)
Credit risk management
Liquidity and counterparty risk
Compliance with investment limits
OTC independent price verification
Performance attribution analysis
Leverage exposure
In addition, RVS provides risk management data for various stakeholders including risk managers, regulators, auditors and board level executives. This includes risk disclosure reports as per regulatory requirements, daily risk reports explaining deviations, abnormal movement notifications or limits breach, as well as tailored summary reports for board meetings and internal reporting.
Kinetic Partners RVS will be led by Dr Christian Szylar who has joined Kinetic from RBS (Luxembourg) SA where he was managing director RBS Portfolio Risk Services.
RVS is a one-stop shop that will allow funds to simply, effectively and accurately assess all the complex risks that funds face in one seamless process, says Christian. We can provide a level of expertise and technology that would be expensive and time consuming to develop and replicate inside an organisation. I believe RVS represents a major step forward in risk monitoring and assessment and once again demonstrates Kinetic Partners innovative thinking on behalf of its fund management clients.
D.C.