The Risk-as-a-Service solution provides supports FX spot, forward, and swap trades and positions, in any currency pair, as well as Crypto including crypto priced in any currency.
Sterling Trading Tech (STT) has added the FX and Crypto asset classes to its industry-leading risk and margin system, providing a new level of multi-asset risk coverage for clients.
The Sterling Risk & Margin System (SRM), which offers advanced analytics as a RaaS (Risk-as-a-Service) solution, already covered global equity, equity options, and equity futures markets for risk calculations.
The SRM uses quantitative and big data techniques to manage risk and monitor margin in real-time, calculating risk scenarios, stress tests, portfolio margin, risk-based haircuts, maintenance margin, and Value at Risk (VaR) for each account, with the capability to add and handle firm-specific house rules, the fintech explained.
FX and Crypto to address market demand
Sterling Trading Tech has seen its risk and margin system being adopted by a growing number of clearing firms, hedge funds, broker-dealers, and proprietary trading groups. Clients leverage the Risk-as-a-Service solution to monitor risk using a GUI and pull data into their downstream systems via an API.
Ravi Jain, Chief Product Officer at Sterling Trading Tech, commented: “We are excited to respond to client and market demand by adding crypto and FX to our sophisticated risk and margin system. The addition of these asset classes expands the functionality of our offering. Sterling is committed to pioneering innovative solutions across multiple asset classes to help our clients achieve real-time pre- and post-trade analysis.”
The risk and margin system offers specific functionalities related to the new asset classes, which include:
- Support of FX spot, forward and swap trades and positions, in any currency pair;
- Support of crypto including crypto priced in any currency;
- Risk aggregated by currency or digital asset, derived by extracting net exposure by currency across all pairs and non-USD equity and crypto trades;
- Ability to view balances by fiat currency and crypto;
- Risk shocks analytics based on fixed percentage moves and standard deviation moves;
- VaR analytics for multi asset-portfolios including equities, fiat and crypto
In June, the firm appointed industry veteran Jeff Marston as Chief Technology Officer, who will manage the overall technology strategy, oversee technological investments to help drive business development, and oversee the development and delivery of technology solutions for clients.
The hire came on the heels of STT’s recent enhancements to its OMS, including fractional shares capabilities that are instrumental for retail and crypto trading, and a new risk-based rules engine, offering broker-dealers and their traders more power and flexibility.