A Look Back at FINCAD’s Top Blogs of 2018
With 2018 winding down, I wanted to take the opportunity to look back on the FINCAD blogs that were the most popular over the past year. During 2018, we covered a multitude of important issues in the derivatives risk management space. From topics around best practices in curve-building to programming with Python and preparing for the fast-approaching Libor benchmark phase out –we try to keep our readers informed on key issues that affect them and how they do business.
Without further ado, below are the top blog posts that ranked the highest in our analytics in 2018. Please enjoy reading them, and be sure to look out for our upcoming technical white paper, “How the End of Libor will Impact Delta-I Rates,” which is planned for release in January 2019.
FINCAD’s Top-Performing Blogs of 2018
1. Are you accurately measuring your risk?
Over the last few years, buy-side firms have increased their use of securities with embedded options such as callable, puttable and convertible bonds, ETF’s and asset-backed securities. When investing in securities with optionality or complex risk profiles, it is important to consider all aspects of the risk profile and how the entire portfolio is affected. Read more.
2. Replacing Libor with Alternative Benchmarks: Gauging the Risks
The end of Libor is slated for 2021. Preparing for this event will undoubtedly create model complexity and associated costs to transition legacy systems that rely on Libor. But the shift to alternative benchmark rates will also expose the presence of new kinds of risk for investors. Read more.
3. Phasing Out Libor Brings Major Challenges to Risk Management
Historically Libor has played a significant role as a benchmark rate. Thus, with the phase out of Libor investors can expect to face significant challenges as they transition to alternative benchmarks, and challenges with unsecured lending risk under the new benchmark regime. Read more.
4. Is Python the New Excel?
Over the last few decades, having good Excel skills has been of paramount importance within the financial industry, almost regardless of your role. But now this trend is shifting at a rapid pace with Python becoming the tool of choice for financial industry participants. Is it possible that Python is becoming the new Excel? Read more.
5. Why Quant Developers Love Python for Custom Analytics
Python has become vastly appealing to quant developers because it is very easy to learn and use. Python is also used for a myriad of purposes including web programming, scientific computation, data analysis and artificial intelligence. Additionally, key features of Python such as exception handling, object-oriented usability and extensive support libraries have made it an excellent choice for developers. Read more.
6. How Accurate Curve Construction Pays Off
Accurate curve construction is an integral part of an investment firm's success. However, market changes such as OIS discounting and greater regulation around margining have made curve-building more difficult than it once was. In this unpredictable marketplace, firms that want to thrive need the flexibility to adjust their curves to reflect market dynamics. Read more.
7. MBS Modeling 101
In this post, guest blogger, Eknath Belbase, PhD, of Andrew Davidson & Co., Inc., gives a history lesson on the evolution of MBS modeling, including how practices have changed from its beginnings in the early 90’s until today. Eknath then reviews his top recommendations for how to model MBS prepayments and defaults in the current market climate. Read more.
8. The Secret to Success in MBS Modeling
It’s no secret that mortgage-backed securities (MBS) have become a safer investment than they were in the years immediately following the crisis. In fact, today investors are adopting more sophisticated trading strategies involving complex investments like MBS, and are generating significantly better returns in the process. Read more.
9. Why Top Performing Banks are Outsourcing Regulatory Reporting
Today, banking industry regulation is tighter than ever—and is being strictly enforced. This puts investment professionals in a precarious position. You must keep focused on revenue generation, all the while investing increased time and money in meeting ever evolving regulatory requirements. Or do you? Read more.
10. Using VaR to Better Understand Risk in Multi-Asset Portfolios
While there are varying opinions about the significance of value at risk (VaR) in risk management, it remains one of the most fundamental methods for the critical measurement of market risk exposures. Discover why having access to complete VaR analysis and the ability to run reports on-demand and intraday helps you improve risk management. Read more.
We hope you enjoyed our look back at 2018, and be sure to subscribe to our blog, as we have a full calendar of exciting topics lined up for 2019.