Risk Management Controls

Effective risk management and control processes provide the necessary assurance that a company’s overall operations, including financial aspects are reliable. This also includes making sure that the given company complies with the relevant regulations and operating principles. Some of the aspects of financial risk management that we have already addressed that you may not have considered, include:

  • Automated risk management
  • Risk assessment
  • Monitoring systems
  • Control aspects
  • Information and communication delivery

New Wave DV believes in pushing the boundaries of technology, so we created an automated risk management tool to be used with our custom programmable logic devices, which saves you time and shaves precious nanoseconds from each delivery. Our risk assessment and monitoring systems also provide optimal security for precise information and communication delivery.

Financial Risk Management & Controls

The Securities and Exchange Commission (SEC) mandates that all brokers/dealers trading securities directly on an Exchange or Alternative Trading Systems (ATS) must establish, document, and maintain a system of risk management controls and supervisory procedures. These procedures must be reasonably designed to deliver the following risk management process and controls:

  • Systematically limit the financial exposure that would arise as a result of market access to prevent orders that exceed appropriate pre-set credit or capital thresholds, or appear erroneous.
  • Ensure compliance with all regulatory requirements that are applicable pre-entry on a per-order basis, prevent restricted orders from trading, and restrict unauthorized access.
  • Document and record results, provide immediate post-trade execution reports to appropriate surveillance personnel, perform a documented review to demonstrate the effectiveness of the system at least annually, and certify annually.

Custom Programmable Logic Devices for Successful Risk Management & Control

Any delay in verification means a loss of a trading opportunity, which directly impacts the ability of the trading company to effectively compete against the marketplace. Companies that are looking to make a major leap within financial trading sectors rely on high-frequency trading technology to mitigate their risk and increase their chances of success. To counteract the challenges that accompany heavy trading, New Wave DV provides customizable ultra-low latency FPGA devices that maintain the following risk management process standards:

  • Inputs the proprietary information for each customer from the broker
  • Inputs every trade from the “naked access customer”
  • Undertakes financial risk management control testing and verification
  • Sends the valid trades on to the exchange, with the lowest latency impact on each trade

Contact New Wave DV today to discuss how we can assist you in your risk management, while also providing the necessary control parameters for more successful algorithmic trading opportunities.

FPGA Design, Verification and Financial Risk Management

There are times when risk management and control verification systems, which employ the server’s main processors, suffer from unacceptable bottlenecks. Tests on file servers using “standard” 10G Ethernet cards for server-network interface have shown that, when performing TCP transfers through their native stacks, even 2.2 GHz processors can be close to 100% utilized but only achieve rates of less than 5 Gbits/s.

During the traversing process of the protocol stack, the processor consumes significant numbers of processing cycles. These cycles then assemble the data into properly formatted packets, and calculating checksums. During these cycles processors become saturated, even before they can reach their 10 Gb/s rates. To solve this problem, our engineers utilize specialized hardware that checks for relevant data on the network card and then passes these to the main processor. This approach yields a significant improvement in response time.

Automated Risk Management & Low Latency FPGA Network Processing Cards

To further improve performance and reduce the delays introduced by the verification step, New Wave engineers created a method to sidestep the main processor altogether and perform verification on the network processing card.

Financial Risk Management Diagram

New Wave Design and Verification’s network-side processing architecture using low-latency FPGAs allows complete monitoring and comparisons to be accomplished at hardware speeds without involving host processors.

This means that trade information never leaves the network card, further reducing latency. Memory arrays on New Wave DV products are built to accommodate multiple large, programmable lookup tables and to execute in minimum time, making them ideal for this application.

Our low latency FPGA designs are specifically built to eliminate any latency and overhead found in typical network card designs, including physical interfaces, shortest path routing, and buffers. This provides a significant competitive advantage in a business where having the lowest latency financial risk management control system is a must.

Contact New Wave for Advanced Design, Verification and Financial Risk Management Tools

New Wave DV provides best-of-class risk management and control devices, including ultra-low latency 10G Ethernet FPGA cards enabled with an easy to use application development framework. Contact New Wave DV today for low-latency FPGA technology and risk management controls. Or, browse our products to find the solution you need.

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