It’s been four years since the best IBOR platform/service category was first added to the Buy-Side Technology Awards line-up, and so far no firm has been able to wrest the award away from SimCorp. Clearly there must be something unique about the way SimCorp delivers its IBOR, which, according to the firm, comes down to three things.
First, it captures and calculates all the historical, present and future cash flows from every tradeable instrument, whether they be exchange-traded equities, OTC products or fixed-income instruments, allowing portfolio managers to feed the data into their risk models and make informed investment decisions. Second, it helps with liquidity management—SimCorp’s IBOR users are able to find liquidity for an order and short margins by using the system’s methods and data models. And third, the platform’s analytics allow users to perform “what if” scenarios and the effect that these would have in the short- and long-term for their investments, provided they have all their cash and securities positions in place.
As would be expected of any market-leading technology, SimCorp has not only maintained its position at the head of the field, but it has also added extra features to reflect the changing market landscape. James Carter, IBOR product manager at SimCorp, says the firm has looked to address three issues for the buy side and has made the necessary tweaks to its IBOR offering. “The biggest is Mifid II,” he says. “We made sure our IBOR captures all the relevant Mifid II data points, such as decision-makers and best-execution prices and all the data that the buy side needs to report on.”
SimCorp has also worked on the underlying data models to calculate the workflow on top of margin payments when users trade derivatives, as mandated by the recent BCBS 239 regulation by the Basel Committee of banking Supervision. It was important, according to Carter, to also provide fund managers with visualization tools to display the available inventories of cash and securities. Finally, the firm has dedicated time and effort to enhance its IBOR valuation models, where users can calculate the value of complex securities such as a region’s negative interest rates.
On February 2018, SimCorp will release version 6.3 of the platform, which will feature a set of APIs that will allow users to plug in their own propriety valuation models. “We will also allow better access to our data from the outside world,” Carter says. “We have exposed API functions as a web service for external tools, like an OMS or Excel spreadsheet.”
Bill Murphy, CTO of Blackstone, once again joins the podcast to discuss the private equity firm's new offices, designed to house its innovations team.Subscribe to Weekly Wrap emails