Razor™ is used for specialised economic capital modelling by a number of banks, hedge funds and brokers. With Razor™, a financial institution can take a rigorous approach to economic capital across all lending and trading books. For credit risk, this involves the regular monitoring of the economic capital that institutions hold to cover exposures to a wide range of counterparties. This approach provides security in all types of market conditions, including the recent volatility in the markets.
Razor Risk has delivered a leading edge combination of thought leadership in managing economic capital and state-of-the-art technology. The business is constantly evolving, and the increasing complexity of trading and hedging activity required us to identify a solution that is inherently adaptable and extendable.
Where the Razor™ solution models the credit component of economic capital, Razor™ has provided results in less than two hours for a process that had previously taken 24 hours. The solution fully utilises the distributed processing capabilities of the technical environment.
With the Razor™ Economic Capital Module, financial institutions can calculate economic capital across all trading and lending activities. It provides:
An agile modelling and stress testing environment for the incorporation of multiple valuations and credit risk models that can integrate market and portfolio credit risks;
The ability to model both default and no default models and credit migration models; and the ability to stress test, probability of defaults, loss given defaults, exposures, correlations, etc