Fundamentals of Counterparty Risk

Part 1: Assessment

  • Prime Broker Financing Structures: Understanding Legal Entity Exposure
  • Understanding Regulatory Regimes and Asset protection in prime broker insolvency
  • Basic risk metrics to evaluate your counter-parties
  • Second Order Risks: Sub-Custodians

 Part 2:  Mitigation

  • Selecting the financing structure for your strategy
  • Diversifying your financing service providers
  • Legal agreements: Key terms for asset protection
  • Reporting: Required transparency post 2008

 Part 3:  Management

  • Exposure Management
  • Counterparty BCP
  • Prime Broker Due Diligence
  • Relationship Management
  • Communicating your counter-party risk process to your investors
  • Industry Trends affecting counter-party risk

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