A leading Global Hedge Fund needed help to solve its Reference Data problems, specifically the risk associated with missing notifications for Listed Derivatives.

Company overview

The Hedge Fund is one of the largest alternative investment firms, with more than USD$35bn in AUM. As the one of the leading market makers in the world, they trade products that include equities, equity options, and futures for retail and institutional clients.

Business situation

The Hedge Fund’s Risk & Compliance team flagged potential risks in its ‘Exchange Notification Monitoring and Processing’.

The existing processes were:

With every notification at risk of being missed, incomplete or incorrect – this could have resulted in serious financial and reputational consequences for the Hedge Fund and its clients.

Analysis and outcome

After the Hedge Fund’s Risk & Compliance team completed a detailed investigation into their operational processes, the following recommendations were made:

Solution

SmartStream RDU’s Exchange Notification Service (ENS) offered the Hedge Fund a complete solution for all of the recommendations made.

The ENS provides a normalised view of exchange notifications related to the management of listed derivatives reference data, sourced from over 100 exchanges. A large team of SmartStream in-house experts, generally with an exchange background, carefully monitor notifications and corporate actions to pick out any points that might have an impact on reference data relating to listed derivatives. Once gathered, data is cleansed, normalised and cross referenced.

Benefits