The prospect of the U.S. Federal Reserve raising interest rates in 2022 will mean a new focus on putting cash to work. Furthermore, the Archegos hedge fund collapse earlier this year showed once again the importance of collateral management and optimizing the calculation of initial and variation margins. So an integrated approach to collateral optimization is very much on the minds of bankers and hedge fund managers.
There are big opportunities to boost revenues and reduce costs but all this can prove difficult to achieve if you are faced with an array of existing systems and the limitations of packaged solutions. David Cassonnet, Global Head of Business Development at ActiveViam, explores the problems posed by collateral optimization and how to resolve them.