email us
OverviewEquity derivatives within KBC Financial Products (KBC FP) needed to 1) rapidly structure exotic equity derivatives, 2) manage the risk on these instruments and 3) reduce reliance on spreadsheets. The companyKBC FP is a leading specialist within the growing global marketplace for convertibles and equity derivatives. KBC FP has a unique approach which is an absolute focus on serving its customers' interests by the innovative application of technology to financial expertise. The briefKBC FP's use of a data vendor's system to download historic data was proving too slow for operational benefit. KBC FP needed a system to access and analyse time-series data, enable the development of proprietary analytics and facilitate simple integration with existing and future systems. In addition, a comprehensive and flexible risk management system was required. 
"Organisations that manage their equity derivative operations using spreadsheets are inherently introducing operational risk; spreadsheets are passed between different trading desks and are modified and extended by different traders. Spreadsheet cells might be moved, amended or deleted. Such a process could lead to the whole hedging strategy originally put in place to come undone. In KBC FP, the Xenomorph solution is the only system allowed on the trading floor that enables spreadsheets to be used. Because Xenomorph systems are very well organised they enable complex time series analysis, including volatilities and correlations, to be completed very quickly. The speed of the Xenomorph systems enables KBC FP to service its clients in a time frame that reflects the business that we are in: our clients ask for innovative structured products on new assets." Jan De Spiegeleer, Managing Director, KBC Financial Products |
The solutionUsing Xenomorph systems, KBC FP download data from vendors such as Bloomberg and Reuters, store it in the Xenomorph time series database and analyse complex time series data in a very fast and efficient manner. Using Xenomorph APIs, KBC FP has developed proprietary analytics to rapidly create volatility cones for multi-asset structures and analyse the correlation between assets, the volatility of assets, baskets and currencies. Xenomorph systems are also used for research, eg, calculation of intra-day volatility. KBC FP has integrated Xenomorph-based analytics with its Sophis trading platform, which facilitates diligent risk management and flexible provision of mark-to-market valuations. KBC FP's innovative lead in the use of financial technology has resulted in access to Xenomorph derived data in its offices internationally. 
"Xenomorph systems have flexible functions that provide users with a very efficient method to access and analyse data; for instance, the use of Xenomorph APIs enable us to rapidly create and analyse historical volatility and correlation series. Furthermore, Xenomorph Data Explorer is a useful application because of its visual representation of complex data structures." Csaba Koppany, Senior Structurer, KBC Financial Products 
"It is exciting to see first hand how Xenomorph systems are assisting in the delivery of KBC FP's strategy. Xenomorph is looking forward to assisting KBC FP in further extending the functionality offered by Xenomorph systems to its offices internationally" Naj Alavi, Head of Client Services, Xenomorph KBC Financial Products is a wholly-owned subsidiary of KBC Bank NV, which is in turn a wholly-owned subsidiary of KBC Banking & Insurance Holding Company NV. trading floors in New York, London, Hong Kong, Tokyo and Brussels and employs 360 people. www.kbcfp.com |
 |
 |
