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Insurers need to comply with multiple regulations like Solvency II by implementing effective Enterprise Risk Management frameworks. But what is Enterprise Risk Management?

Enterprise Risk Management is a risk management approach meant to encompass all risks and opportunities across the entire enterprise — including the governance, risk and compliance (GRC) aspects. One of the Enterprise Risk Management best practices is to embed the process into strategic planning. Enterprise Risk Management shou

Of course, Solvency II has not gone away. The new solvency requirements will be implemented. But the lull in urgency to meet an enforcement date is triggering a predictable and understandable reaction from those insurers that are responding to Solvency II with a compliance approach rather than a best practice corporate governance and risk management approach.

The ‘compliance only’ firms are easing off their SII projects, taking a well earned break from the stress and expense, and re-allocating re

The economic climate and tightening regulations are prompting large enterprises to invest in capability management tools - a new category of software that helps senior decision-makers to understand the organisation’s readiness to implement new initiatives.

Large, complex enterprises run a huge risk every time they implement a new strategic initiative. The risk is that something important will have been overlooked in the planning stage that will cause the initiative to fail, run over time or over

Wall Street Journal - Risk & Compliance Journal

Chobani’s recent problem of mold in its yogurts shows the early warning that can come from social media but also the difficulties consumer companies can face in responding quickly enough to satisfy their consumers. The company announced its voluntary recall on Sept. 5 after it began notifying stores to take product off the shelves late in the week of Aug. 26, but an analysis of social media done for Risk & Compliance Journal by ListenLogic, a provid

Nearshore delivery models remain a valid response to many of the pressures financial institutions face today. The challenge is that they tend to focus on areas such as application maintenance rather than transformation. How can organisations sustain truly transformational IT projects that call for continuous and agile interaction between the business, architects and development teams?  

Financial institutions must take a more responsive approach to nearshore. Flexible styles of working are ideal

Of all the global sporting contests, few parallel investment banking as well as the America’s Cup regatta. The latest round of the world’s oldest sporting competition kicks off in San Francisco this month and provides a timely, unique comparison to the evolution of risk management in the global financial services industry.

In 1851, an American schooner raced with the Royal Yacht Squadron around the Isle of Wight off the southern coast of Great Britain,  winning a surprising victory and setting in

Managing Risk with Options

Our partner, TraderMinute.com launched its first public $100K challenge in March of 2013. The Challenge is a unique concept where they try to turn $3,000 into $100,000 in only 4 months! They use a live brokerage account and allow active subscribers to follow each trade in real time via email, text, and live video.  The question is: Have they ever turned $3k into $100k? Yes: They have accomplished this feat twice with other success of 47K, 19K, 21K, 4K, and 4 losses.

The Basel Committee, which creates regulations for banks, has published a set of principles regarding effective risk data aggregation and risk reporting, which will provide a fantastic business case for risk professionals to improve their risk frameworks. I’ve included highlights below, but you can take a look at the full report here.

The principles for effective risk data aggregation and risk reporting will be mandatory for globally systemically important banks (G-SIBs) from 2016, and the Basel

L’exercice 2013 de preparation a Solvabilite II, something close to a French Solvency II dry run scheduled for September 2013, gives French insurers the chance to immediately take advantage of the lessons learned by other European insurers that raced to be ahead of the Solvency II curve. Many of the mid-size and small French mutual insurers (les mutuelles) held back from initiating projects and they can now draw on the best practices that have come out of early adopter projects across Europe fro

The new category of domestic systemically important banks will increase the data management and disclosure burden on qualifying institutions, at a time when many are already feeling the strain.

Banks that escaped classification as G-SIFIs in 2011 may have breathed a sigh of relief at the time, but for many, that relief will have been short-lived. In October last year, the Basel Committee on Banking Supervision (BCBS) set out its proposed framework for an additional category of systemically import

I was recently asked by a young risk professional for recommendations on good books on risk.  Here is my short list:

Today’s banking industry must deal with an evolving regulatory landscape by developing new and innovative strategies for acquiring and optimizing capital. Banks must find a new way to raise capital, maintain a functional capital structure, and continue providing the products and services their customers demand while staying profitable. The new deadline for implementing the Basel III capital requirements makes capital management the most important issue for banks today.

Bogie Ozdemir, Vice Preside

Interview with Paul Emerson, Vice President, Asset Allocation, Risk Management at AllianceBernstein, L.P.

Operational risk management has moved beyond the simple calculation of capital requirements. Today operational risk managers need to have a proactive, holistic approach to operational risk to ensure they maintain their organizations’ profitability and reputation. Recent financial scandals have shown that operational risk could bring tremendous losses and not every firm is capable of recoverin

The energy market is becoming increasingly competitive and volatile. The key to maintaining a competitive advantage is to develop effective hedging strategies and minimize risk exposure. With the new regulations introduced by the Dodd Frank Act, energy companies have seen a big change in their approach to hedging and they are on the look-out for establishing effective hedging strategies to value their assets and optimize their revenue.

Stephen Wemple, Vice President, Regulatory Affairs, Con Ediso

Operational risk management has evolved from the simple calculation of capital requirements to a proactive, holistic approach. This new strategy ensures that operational risk managers maintain their organizations’ profitability and brand reputation. In fact, recent financial scandals revealed that operational risk can result in incredible losses that many organizations can sometimes never fully recover from.

According to Ger Jan Meijer, Director of Operational Risk Management for Citco Fund Servi

Quantopian, a start-up from Boston, wants to help ambitious traders disprove what many people have accepted for quite a while now – that while an individuals may get lucky from time to time, they cannot beat the market over a long period of time.

The company provides a service that allows individual traders to write their own trading algorithms and use them however they like. In this way, more individual traders could get involved in algorithmic trading without the help of a larger entity.

Found

In this posting we take a look at Nassim Taleb's video and show a working example of the Sigmoid function in R Project.

Many risk practitioners approach the quantification of risk by convoluting frequency and magnitude curves.

The Sigmoid concept which is at the heart of Antifragile, looks at risk differently. It breaks up a system into various states of Fragile and Robust, then brings them back together as a single function of risk.

More can be found here [ LINK ]