LONDON / NEW YORK / SYDNEY / HONG KONG, 31 January 2023 – Cassini Systems, the leading provider of pre-and post-trade margin and collateral analytics for derivatives market participants, is offering firms an AANA (Average Aggregate Notional Amount) snapshot free of charge to provide firms with guidance on where they can reduce their AANA levels. This report is an invaluable tool for companies either in scope for UMR (Uncleared Margin Rules) or on the cusp of falling into scope. Further, Cassini has released a whitepaper to educate the sector on the latest AANA calculation requirements for multiple regions and the benefits of continuous monitoring and optimization of AANA before the designated reporting period.
Over the past twelve months, the combined effects of market instability and tightening regulations have led to huge spikes in IM (Initial Margin). So, a firm’s ability to reduce the impact of UMR on its business operations can be the difference between sustained success and failure. Now, as the calculation period for AANA approaches, it is apparent to those familiar with the rules that understanding and monitoring the AANA calculations as early as possible is critical for any firm to succeed.
This need for firms to proactively manage their AANA is heightened by the fact that there are changes in the monitoring periods and compliance dates for post-phase 6 firms to be aware of. Most importantly, effective management allows firms to reduce business costs and optimize trading exposure. Long-term monitoring strategies are also essential for firms wanting to analyze their AANA levels or, for firms already captured under UMR, balancing exposure across counterparty agreements, potentially moving out of scope
Thomas Griffiths, Head of Product of Cassini, said: “We’ve found with our clients that the level of uncertainty around knowing whether they were in scope for UMR caused a significant drain on their business. Continuously monitoring and optimizing their AANA gave them the confidence to adapt their trading strategies and put them on the front foot for their UMR compliance.”
For previous UMR phases, Cassini has been the go-to system for firms to analyze whether they fall in scope or not and implement long-term strategies to identify consumers of margin at pre-trade. This has helped clients put strategies for trading in the most cost-efficient manner and immediately identify trading agreements that fell in scope for UMR. Analyzing AANA by tracking the calculation and warning thresholds over time ensured firms could proactively plan and manage when the firm might move in or out of scope for UMR.
For firms looking to take a more long-term, holistic approach to AANA monitoring, calculation, and reporting, download Cassini’s newest whitepaper: AANA Monitoring and Optimization Strategies in 2023.
Founded in 2014, Cassini Systems offers an award-winning derivatives margin analytical platform that provides the industry’s only front-to-back margin and cost analysis across the entire lifecycle of a trade. Cassini users can calculate any margin on any cleared or uncleared derivatives asset; analyze drivers and movement in margin exposure; reduce Initial Margin levels; and maximize margin efficiency with the firms’ industry-leading, advanced algorithms.
Cassini services have a proven track record of enhancing portfolio returns at every point in the daily business cycle, empowering traders and portfolio managers to analyze instantly in the pre-trade stage the all-in, lifetime cost of a transaction. Top-tier hedge funds, asset managers, and global banks rely on Cassini for powerful, flexible, automated tools to manage their portfolios of over-the-counter and exchange-traded derivatives products. Cassini was named Best UMR Service of the Year in the Risk Markets Technology Awards 2022 and the Derivatives Technology Provider of the Year by the 2022 GlobalCapital Derivatives Awards.
John Norris / Emma Dodds
Tel: +44 (0) 20 7250 4770