We help clients establish pragmatic governance over models and analytics, and conduct robust review and quality control of models

Risk Dynamics supports wealth and asset management firms in model development, model validation, and risk management.

What do we do?

Working with us helps clients examine the modelling components of their investment strategies -- quant strategies in particular. We partner with them to review broker algorithms and risk management models, including vendor models such as MSCI Barra, RiskMetrics, and Axioma. We also review platforms, for example, algorithmic trading systems, chat bots, and valuation engines. And we help clients create model risk frameworks customized to wealth and asset management.


Our impact

We reduce our clients’ risk of model failures and improve model performance. We also reduce regulatory risk, and help clients avoid reputational risk.

Case studies

  • Reviewing and improving an operational risk model

    Risk Dynamics supported a British-based global investment manager in meeting demands by the Financial Conduct Authority and Prudential Regulation Authority for an independent review of its economic capital framework for operational risk. We convened a team of operational risk modelling and validation experts to support the necessary analyses. We worked with the client to perform a detailed validation of its operational risk model, applying team expertise along with Risk Dynamics’ validation framework and market benchmarks.

    We created a timely, high-quality report with concrete recommendations for improvements to the effectiveness and efficiency of the client’s model governance and performance, in line with regulators’ expectations.


  • Designing a model risk management framework

    Risk Dynamics supported a Swiss-based wealth and asset manager in designing foundational elements of a model risk management framework. This included a draft MRM policy covering the MRM function’s mandate and governance, along with model lifecycle governance, and a model review framework, covering methodologies, process, and documentation.

    We organized workshops to educate key client stakeholders on MRM practices and benefits, and engaged them in designing the framework.

    We increased management awareness on deploying an MRM framework across business stakeholders, which will help ensure their collaboration during the framework’s implementation. We also prepared an implementation plan aimed at reaching an MRM target state within 2.5 years.