Precision Trading Operations provides a set of applications with Trade Capture at the core. As trades are manipulated the information is disseminated to the other applications in real-time so that appropriate actions may be taken.
We have a solid code base that takes care of the standardized processing of trades: ensuring transaction integrity, user authorization and authentication, security management, reporting, UI construction and a whole slew of other functions. We realize, however, that no two clients are the same we are continuously expanding our suite of applications to fit each client's specific needs. We fully expect each client to have their own requirements and believe we can quickly build on our foundation to give the client the flexibility of customized development with the shared economic advantage of a vendor product.
Our systems are developed in Java (J2EE) using an n-tier architecture based on EJB, JMS and Web Services technology layered on top of a relational database. We also use LDAP technology where appropriate. We emphasize strong frameworks to enable us to provide scalable, powerful and quick-to-deliver solutions. Clients may tap into the core system through web services, notifications delivered on event queues or by plugging in their own classes.
Trade Capture (click here to see screen shot)
The trade entry module is at the heart of the Precision suite of components. It provides the entry point for trades, whether they are being manually keyed in by the middle office or being electronically captured from an exchange or broker. The functionality in the module includes:
- Capture, approval and subsequent amending of trades
- Filtering based on virtually any piece of information on a trade or security
- Security Master Definitions for exchange traded products
- Position Monitoring
- Reference Data Support
- Reporting (e.g., open trades, daily activity, maturing trades, etc)
- Trade actions such as allocations, assignment and terminations
- Complete Audit History and the ability to view the portfolio as it existed at any point in time
- Trade Ticket Generation and Printing
- Blotter Configuration and Printing
In addition, we provide facilities for tracking agreements and credit events. As actions occur on the trades, events are broadcast which other modules and client code can list for and respond to accordingly.
The following product set is current available:
- Energy Commodities
- Products: Power, Natural Gas, Oil, Coal, Emissions, Transmission, and Capacity
- Instrument Types: Forwards, Swaps, Swap Options, Options, Spread Options
- Interest Rates - Swaps, Caps/Floors, Swap Options
- Bonds
- Repos
- Credit Default Swaps
- FX - Spot/Forward
- Futures
- Options on Futures
- Equity - Cash, Options
Confirmations/Affirmations
The confirmation module allows customers to generate and track trade confirmations. It listens for updates from the trade engine so that confirmations are automatically generated as trades are entered into the system. It allows for review of trades by traders and/or other personnel before allowing the confirmation to be sent, or, if not required, will automatically generate and send the confirmation. The confirmer tracks amendments to trades and based on which fields have changed determines whether a new confirm needs to be generated. The confirmer allows incoming faxes and emails to be processed directly, storing the documents with the trades and allowing annotations to be kept with the confirmation record. There are hooks available to allow for confirmations to be rerouted to auto-matching facilities if they meet the requirements.
Invoicing (click here to see screen shot)
The invoicer is designed to provide an integrated view of all settlement details across the portfolios. It provides users with the ability to check-out with customers prior to generating invoices down to the smallest time interval of the underlying trades. It also provides the tracking of payments related to physical delivery as well as financial settlement and associated fees. Adjustments entered on trades will flow through to the invoice. There is internal support for netting agreements and provisions for allowing product groups to be established based on counterparty preferences.
Market Data
The market data repository holds audited copies of curve data and configuration information. It provides for the definition of the segments that make up the curve and allows for curves to be composed of spot, basis, weighted and formula sections. It allows for spot curves to be defined to store data using any time unit that is applicable and allows proxy curves to be defined for both settlement and forward pricing. An interface is available that allows for market data to be the submitted to or queried by the Precision system from internal or external systems.
Power and Gas Scheduling
The scheduling module has been designed as a replacement for the spreadsheets that many schedulers use to manage bookouts and scheduling of long and short physical positions. The module provides auto-match capability for direct bookouts as well as intelligent matching of user selected trade flows for bookouts and physical schedules. It provides a view into the underlying transmission of the product (either through wires or pipelines) that allows the customer to match their physical trade with their transport, providing an accurate cost of physical trading. As with all modules, the schedule module listens for trade updates and immediately makes that information available to the scheduler. The scheduler may record paths within the system and the positions may be filtered and sorted on most attributes of the underlying delivery information.
Subledger (click here to see screen shot)
The subledger has been designed to allow finance personnel to view the P/L for the customer's operations. It allows for drill down through the hierarchy to be able to identify problems that might occur during P/L computation as well as view P/L across specified time periods. It picks up trade adjustments (both volume and fixed amounts) as well as any counterplay top-side adjustements.
Valuation Framework
Our experience has shown that for all but the simplest of instruments clients want to be able to provide their own analytics. We have implemented an engine that manages the submission of pricing requests and routes those requests, based on a predefined protocol, to the client's models. The valuation engine takes care of managing the dependency trees and will listen for changes to market data and trades to trigger the recomputation of trade values. We give the client the option of integrating their own models, or allowing us to integrate their own or vendor supplied analytic packages. Models can be run on any computers in the client's organizations allowing for efficient computations both for real-time pricing and end-of-day processes.