NEWS

DBAB extends Derivatives.com to clients

Deutsche Banc Alex. Brown (DBAB) is extending Imagine Software’s Derivatives.com trading and risk management system to its clients over the Web by means of an application service provider (ASP).

The bank, which has been using the system in-house since 1996 for front-end trading and risk management for its equity derivatives, cash instruments, exotic options and structured products, will make it available to Prime Services clients for risk management on equities trading.

Using an ASP model allows the firm to begin the service immediately with relatively little investment. "As the costs of developing and maintaining proprietary risk management software and infrastructure rises, traders and investors alike are looking for alternatives that are standardised," James Rowen, co-head of prime services at DBAB, told D&RT.

The Imagine system allows clients to enter data into a standardised platform on the Web, using Reuters data and analytics from Imagine, and/or Deutsche Bank’s global databases. "It’s the data and the models that are becoming the differentiating factors, not the infrastructure," said Rowen. But being able to deploy an off-the-shelf, standard platform can produce significant savings in terms of cost and time-to-market. Scott Sherman, partner at Imagine, said firms could save two to three years, and 75% of the cost of developing their own platform.

The addition of Derivatives.com means DBAB now offers a suite of three risk management products: Imagine, offering trading tools for institutional investors and fund managers; DB Risk Office (formerly RAROC), aimed at institutional investors and administrators; and Risk Position, for clients that require the bank to assist in investment risk monitoring on a daily basis.

-- Max Bowie