Interactive Data, a provider of financial market data and analytics, says its valuations service for OTC derivatives and structured products, offered in conjunction with Prism Valuation, is now being used by more than 25 financial institutions.
A wide range of institutional clients around the globe, including custodians, asset managers, hedge funds and sell-side firms, subscribe to the service, which offers a high level of transparency and broad coverage.
Transparency reports provide a breakdown of the method used to achieve a given valuation for each deal, including a detailed discussion of the models and calibration strategies selected. This level of transparency can help clients comply with current regulatory and auditing demands.
In addition, the service offers a discrepancy analysis, which can help a client understand the variations that arise from different valuations of an instrument, by comparing the client’s in-house valuation with the independent valuation, and concluding with an opinion of the maximum valuation deviation for that product.
Anthony Belcher, director, European fixed income, Interactive Data, says: "Clients welcome the transparency that we are able to offer, as well as the flexibility of our service and the breadth and depth of our coverage. There has often been a high degree of uncertainty when performing valuations of complex instruments. We work with clients to mitigate this uncertainty by helping ensure that the service we offer helps to meet their obligations from the valuation, associated values and delivery standpoints. The service can also help firms perform functions such as independent price verification (IPV), product control and compliance. We aim to help customers meet their mark-to-market pricing requirements, while enabling them to understand the associated risks and sensitivities."
