Sixty three per cent of asset managers believe that risk management requirements have changed as a result of recent market volatility, with a further 35 per cent saying they have change
Sixty three per cent of asset managers believe that risk management requirements have changed as a result of recent market volatility, with a further 35 per cent saying they have changed significantly, according to research by Sophis.
The Sophis survey of 140 professionals at the recent Lepus seminar held in London also found that 73 per cent believe it is essential to have an integrated view of risk that includes derivatives.
A further 75 per cent will increase the volume of stress tests and value at risk reports that they carry out and 65 per cent will improve pricing and data models.
The panel of speakers at the Lepus seminar debated how the asset management industry needs to change in 2009 in response to the economic crisis. They outlined how complex risk management has now become for asset managers and why an integrated view of risk is no longer a nice to have but a must have.
When asked what would be the most important consideration when investing in new risk management tools, delegates said real-time consolidation of net asset value, a range of simulation and risk scenarios, fund returns analysis and performance attribution, and cross-asset value at risk.
Sebastien Roussotte, chief operating officer at Sophis UK, says: ‘The buy-side recognises that it needs the same robust systems and processes as the sell-side, regardless of whether new regulation is introduced or not. Institutional and retail investors alike need to have confidence that their investments are being well-managed. Asset managers and hedge funds will increasingly be asked for transparency and regular reporting not only about performance of their funds but also about the risks that are being taken.’
Sophis is a provider of cross-asset, front-to-back risk and portfolio management solutions.
