Derivatives solutions provider SuperDerivatives announced Tuesday that Nordea, a Nordic bank, is to use its derivatives market data to calculate market values and risk. The bank will use SuperDerivatives’ foreign currency volatility surfaces to make calculations on a daily basis.
The sub-prime crisis and recent reports of shock trading irregularities have focused market participants’ attention on the need for accurate and independent risk management.
“The recent market turmoil has demonstrated the importance of accurate daily valuation to manage risk and comply with accounting regulations,” explains Mikkel Fruelund, head of product control, Nordea. “This begins with precise independent market data. We were looking for a provider with broad coverage across currencies and asset classes, which we found in SuperDerivatives,” he adds.
“By using its volatility surfaces data feed we can calculate end-of-day market values and provide price transparency to our customers. This data helps us comply with current international accounting standards and financial regulation at a time when risk management is of key importance to the derivatives market,” continues Fruelund.
The accuracy of middle and back office systems is largely dependent on the quality and coverage of their derivatives data feed. SuperDerivatives says its market data enables market participants to determine the fair market value of all major derivatives.