NEW YORK and LONDON, March 3, 2021 /PRNewswire/ — LMRKTS, an industry-leading optimization and compression provider, announced today the successful completion of a proof of concept (PoC) for a holistic ISDA Standard Initial Margin Model (SIMM) Optimization across Rates and FX products. LMRKTS led the PoC in conjunction with AcadiaSoft, Inc., the leading industry provider of risk and collateral management services for the derivatives community. The PoC for this new industry service leverages LMRKTS’ best-in-class mathematical expertise and AcadiaSoft’s extensive network and data management capabilities to deliver margin reductions for buy-side and sell-side financial institutions.
Market participants are required to adhere to margin requirements for non-centrally cleared derivatives. Through optimizing ISDA SIMM, market participants can minimize their margin costs while also better managing their risks.
“Our unique ability to maximize margin reductions for both rates and FX in a single run ensures that the RatesFX product class is optimized holistically, and therefore most efficiently,” says Andrea Ianniello, President and Chief Commercial Officer of LMRKTS. “Adding cleared nodes further improves our already strong benefits.”
A network of global financial institutions participated in the first PoC, with the second planned this month. LMRKTS uses clients’ input files in the Common Risk Interchange Format (CRIF), the ISDA SIMM standard model for risk sensitivities, which it receives directly from AcadiaSoft with granted permission by the participants.
“We are proud to be working with LMRKTS on this PoC and look forward to further collaboration. Our common goal is to reduce risk and increase efficiency in post-trade processes for our mutual clients,” said Fred Dassori, Chief Product Officer at AcadiaSoft.
LMRKTS is a leading provider of optimization and compression services that helps financial institutions manage derivatives exposures. LMRKTS contributes to the stability of the financial system by reducing capital, balance sheet, and operational costs for its clients. Since the launch of its first commercial service to reduce risk and leverage exposures in G10 currencies, LMRKTS has gone on to eliminate trillions of dollars of obligations between some of the world’s largest financial institutions. LMRKTS was founded by former traders and technologists who saw an inefficiency in short term risk management and has received investment from The World Bank and Motive Partners.
AcadiaSoft, Inc. is the leading industry provider of risk management services for the derivatives community. Its industry-wide repository of margin and collateral data helps firms to mitigate financial risk and optimize resources across the entire trade life cycle.
AcadiaSoft’s suite of analytics solutions and services helps firms measure the quantitative aspects of risk management. Through an open-access model, AcadiaSoft brings together the top derivatives banks and asset managers, along with several market infrastructures and innovative vendors.
Backed by 16 major industry participants and market infrastructures, AcadiaSoft is used by a community of over 1600 firms exchanging more than $1 trillion of collateral on daily basis via its margin automation services. AcadiaSoft is headquartered in Norwell, MA and has offices in Boston, Dublin, Dusseldorf, London, New York, and Tokyo. Follow us on Twitter: https://twitter.com/AcadiaSoft_ and LinkedIn: https://www.linkedin.com/company/acadiasoft-inc/