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Derivation Software

Derivation Softwarehedge funds


Demonstrating thorough risk management controls to restore investor confidence, whilst staying ahead with innovative products.

Turbulent market conditions have seen Hedge Funds consolidate with pressure to both cut costs and continue to develop new strategies and generally stay ahead.

Investor confidence is being restored with extensive due diligence demanding that the very best risk management infrastructure is in place to secure their investment. Only with this belief, can a hedge fund attract investment to allow its talented individuals to develop and use the latest derivative products to maximise returns for their clients.

quick to market with “out of the box” connections

Derivation has a wide range of hedge funds clients from absolute returns to global macro. Most want a single solution and all want to understand their risk exposure as well as needing some of the following key features to get them operational quickly:

  • A software platform that is both affordable now and will scale with the growth of the fund in the long-term
  • Quick to implement “out of the box” interfaces to prime brokers, administrators, trading platforms & data providers
  • Flexible tools to reconcile transactions, positions & cash; with real-time P&L and NAV
  • Trader, hedging & stress testing risk functionality; as well as a VaR reporting suite

robust, scalable software platform

Derivation is engineered by computer scientists to be scalable to run in the largest investment companies in the world, with such key features as:

  • Dealing extremely high trade volumes, avoiding bottlenecks maintaining performance
  • Calculating 10,000s derivatives in real-time
  • Open systems architecture, allowing in-house model integration
  • Quick to implement with “out of the box” APIs for trades, analytics and all market data, capable of easily integrating with any in-house system
  • Regularly deployed across multiple continents running multiple “end of days”

key features for Hedge Funds


Portfolio management Standard interfaces
  • Multi-level views, funds, books & strategies...
  • Excel feel, customisable display of 1000s columns
  • Display positions and entire markets of instruments
  • Trade files to/from prime brokers & administrators
  • Real-time connections to trading platforms
  • Easy to reconcile transactions, positions & cash
Risk management Real time and historical P&L
  • Flexible scenario analysis & stress testing
  • Historic VaR risk reporting
  • Complete risk concentration and drill-down
  • Tick by tick P&L with alerts/colouring
  • View by any period: Daily, MTD, YTD, Lifetime
  • Backdated changes with full trade audit
Analytics Calculators
  • Greeks: Delta, Gamma, Vega, Theta, Rho...
  • Implied: Volatility, Credit Spreads & Yield
  • Historic analytics and charting service
  • Pop up calculators producing “on the fly” theoretical pricing and analytics
  • Easy to use new issue calculator
Views & search functions Market data feeds
  • Worksheets can be filtered, sorted and aggregated
  • Sophisticated search functions allow users to drill down to information quickly
  • User defined formulae can be used in any worksheet for complete customisation
  • Bloomberg and Reuters for real-time pricing
  • Automatically load terms data from Bloomberg, Reuters and MACE
  • Credit spread data from CMA
Copyright © 2009 Derivation Software Ltd