Financial Markets Risk Management

Financial services providers are not the only ones to face financial market risks. Industrial companies, too, are exposed to risks triggered by financial market fluctuation and default on receivables. These risks have an impact on your bottom line and, in extreme cases, can even pose a threat to the very existence of your company. You can quantify the risks incurred by your company and take active steps to control them by employing appropriate methods. In the context of numerous projects at major industrial companies and corporations, d-fine has demonstrated how this can be achieved in an efficient and appropriate manner, in line with individual clients' business requirements.

Financial market risks are triggered by fluctuation in interest rates, exchange rates, share prices and commodities prices. You can only make an executive decision as to which risks you wish to bear and which risks you would rather avoid if you are in a position to judge the scope of the risks in question and, as a result, the potential impact that they could have on your earnings planning. Risks can be measured by selecting suitable standard gauges (e.g. cashflow-at-risk or earnings-at-risk) and evaluating the data in a consistent manner. By employing common financial transactions in a targeted manner, it is possible to reduce such risks to a level that you believe to be appropriate for your company.
d-fine offers support in quantifying and managing financial market risks relating to

• Costs and revenues in foreign currencies
   
• Refinancing costs
   
• Commodities procurement and trading 
   
• Asset investment 
   
• The management of provisions and segregated assets

d-fine can support you at all stages of the risk management process:

• Risk identification, modelling and quantification  
   
• Development of risk strategies, including risk limitation 
   
• Optimisation of hedging strategies 
   
• Valuation of derivatives 
   
• Management of liquidity risks 
   
• Selection and implementation of suitable IT systems for trading, risk management systems and limit management

We're not simply concerned with producing design concepts; we help our clients to develop tailored solutions that can be implemented in practice. And d-fine actively supports the implementation of these solutions at your company, including process optimisation and integration in your IT landscape, e.g. by introducing suitable software. Naturally, our projects give you access to d-fine's extensive pool of expertise, which covers a whole range of areas including accounting, financial engineering, credit risk and corporate finance.

You can find find more information about  „The efficiency of liquidity transmission“ at banks and corporates here.