Annually, Chartis conducts an impartial research of the vitality buying and selling threat administration (ETRM) system panorama and determines rankings primarily based on sure classifications, specializing in options and business segments. It then ranks the highest 50 know-how suppliers and identifies the highest gamers in particular answer classes. Total, Nasdaq’s options ranked #18 and within the commerce surveillance: oil and gasoline answer class, Nasdaq ranked #1.
Sturdy Danger Platform
Regulators require exchanges, marketplaces, banks and brokers to watch an array of dangers as a result of the default of 1 or a bunch of individuals might quickly lead to contagion throughout the vitality and monetary markets. For example, vitality markets could be risky at occasions. An excessive case occurred in April 2020, when the value of West Texas Intermediate crude, the U.S. benchmark, dropped to minus $40 per barrel. In one other case, pure gasoline costs hit document ranges after Russia invaded Ukraine in February 2022. Such occasions spotlight the significance of figuring out your shoppers’ liquidity place, at all times preserving shoppers’ money balances seen, and performing rigorous, complicated stress assessments intraday.
Nasdaq Danger Platform (NRP) was acknowledged within the Energy50 awards for its complete characteristic set and sturdy method to vitality threat administration throughout North America, Europe, and Asia Pacific. Importantly, as a result of NRP is a cloud-based SaaS answer, it reduces operational complexity and permits shoppers to be onboarded shortly.
NRP allows shoppers to watch their buying and selling exercise in actual time and adjust to a number of laws – from internet capital and buyer safety to market entry and extra. Every time a brand new commerce, place, or worth is up to date, all the portfolio is recalculated. It dynamically updates positions, preliminary margin and burdened preliminary margin calculations, liquid fairness, worth in danger (VaR) and excessive worth in danger (HVaR), P&L, and internet publicity. It performs multi-factor stress testing throughout a number of market enter, instrument and business code dimensions. Vitality threat managers can set limits and obtain alerts earlier than reaching a fabric threshold.
The characteristic set spans energy analytics, vitality knowledge, futures and choices, and algorithmic buying and selling. The answer calculates market threat for cash-settled energy, oil and refined merchandise, gasoline (pipeline, LNG, and NGLs), coal, freight, OTC vitality derivatives, floating offshore wind (FOW) in vitality property, and vitality portfolio administration. The margin analytics performance helps vitality threat managers assess credit score threat. Additional extra, the answer helps commerce surveillance and supplies enterprise functions assist for asset administration.
Customers can combination threat outcomes throughout a broad vary of configurable dimensions and slice and cube threat primarily based on their very own threat coverage and reporting necessities. This element helps aggregation of place, account, and burdened P&L outcomes throughout dimensions, equivalent to business classification, execution venue, instrument particulars and account attributes. It additionally helps customized calculations and filtering.
As well as, customers can use the real-time what-if performance to mannequin the chance influence of a number of completely different use circumstances throughout their accounts and positions. Use circumstances embody adjustments in portfolios, VaR, market knowledge and margin fashions, in addition to the influence of onboarding new accounts.
Nasdaq’s ETRM providing is now much more complete with the mixing of Adenza’s regulatory reporting answer, which permits shoppers to adjust to many laws together with:
- Regulation on Wholesale Vitality Market Integrity (REMIT)
- European Market Infrastructure Regulation (EMIR)
- Market Abuse Regulation (MAR)
- Dodd-Frank Wall Road Reform and Shopper Safety Act
- Securities Financing Transaction Regulation (STFR)
- Markets in Monetary Devices Directive II (MiFID II)
Trusted Commerce Surveillance
Orderly buying and selling, equity, effectivity and reliability of vitality provide is essential to customers and companies. Any breakdown or dysfunction within the vitality provide chain has a direct influence on society. To this finish, regulators anticipate vitality market individuals to police themselves and be sure that their merchants adjust to trade and nationwide guidelines. For the reason that monetary disaster, market supervision and rulemaking have been pushed by issues about systemic threat, predatory behaviors, and worth manipulation. Furthermore, the authorities have converged vitality and monetary markets regulation as a result of spinoff devices are frequent to each.
A compliance and surveillance course of that depends on spreadsheets and pivot tables is insufficient for immediately’s complicated types of manipulation and market abuse. Firms want an analytical engine with the aptitude to ingest huge quantities of commerce knowledge and to routinely detect suspicious buying and selling patterns.
Nasdaq Commerce Surveillance (NTS) is a completely hosted SaaS service that works with contracts spanning 40 vitality and commodity markets globally. It aids the detection, investigation, and evaluation of probably abusive or disorderly buying and selling patterns, enabling individuals to successfully establish potential market abuse and mitigate and handle market abuse threat.
The answer supplies full consumer knowledge administration by sourcing and integrating buying and selling knowledge from the general public market, together with from information feeds and a consumer’s buying and selling knowledge. Its complete alert administration capabilities present for straightforward person workflows and the flexibility to tailor alert parameters primarily based on every consumer’s enterprise wants. Purchasers can use the calibration operate to check knowledge already within the system and deploy adjustments to parameter values for alerts.
The up to date web-based person interface, known as NTS Workbench, permits for max configurability and much more dynamic visualization performance. NTS has a complete suite of investigative instruments that present the analytics and commerce visualizations to assist alert evaluation and market abuse investigations. These instruments, which embody Unfold, Historical past, Depth, Replay, Each day Report, Correlate View, and Mounted Revenue View, enable shoppers to visualise and add market context to the alerts generated by NTS.
Selling Market Integrity
Vitality merchandise are traded in marketplaces throughout the globe at lightning speeds and typically in risky situations. The flexibility to watch, measure, mitigate, and handle threat on this complicated atmosphere and adjust to myriad laws is essential as a result of it promotes market integrity and conjures up investor confidence.
Expertise is the important thing enabler for an efficient ETRM program and exchanges, marketplaces, banks, brokers, regulators and companies have many options to select from. We respect the popularity of our work within the Chartis Energy50. Nasdaq is dedicated to innovating, adapting, and investing in these and different know-how options to assist our shoppers handle threat throughout their organizations.
