This chapter provides an overview of reevaluating deals, provides the prerequisite tasks, and discusses how to:
Process portfolio reevaluation.
Process security mark-to-market.
Market factors create exposures for your PeopleSoft deal transactions. To evaluate the risks associated with these exposures requires the use of complex analytical models to value these deals and obtain analytic sensitivities used to analyze the deals. Risk Management enables you to revalue positions periodically; ensuring you base the portfolio's value on current market rates or the price of the underlying.
You must define analytic structures and analytic parameters, set up your third party vendor information, define function parameters, and specify file export parameters before you can start revaluing your positions.
Before you reevaluate deals, perform the following tasks:
Create deals.
Analyze and calculate risk.
Group deals and hedges into portfolios.
See Also
Capturing Deals and Trade Tickets
Creating and Maintaining Hedges
Function Usage |
Select from the following: Delta: Describes an option premium's sensitivity to changes in the price of the underlying. It is the amount of the underlying necessary to hedge small changes in the option price for small movements in the underlying. MTM (Mark-to-Market): Calculates the value of the financial instrument based on the current market price of the underlying. MTM-A (Mark-to-Market Accounting): Calculates the clean value of the financial instrument based on the current market price of the underlying for accounting purposes. This value does not contain any accrued interest. |
Analytics Mode |
Limit the analysis by specifying an analytics mode from the available values. Available values are limited by your implementation configuration. |
Portfolio |
Select the portfolio to process. |
This section describes how to define the parameters for deal analysis.
Page Name |
Definition Name |
Navigation |
Usage |
Deal Analytics |
MTM_DEALVAL_PNL |
Risk Management, Reevaluate Deals, Deal Analytics, Deal Analytics |
Override the analysis results by manually entering values. View a history of values that were created during the lifetime of the deal. |
Deal Risk Measures |
MTM_DEAL_RSK_SEC |
Click the Risk Measures link on the Deal Analytics page. |
View the various types risk metrics for the deal. |
Run the Mark-to-Market Batch application engine process (TR_PORT_MTM) on your portfolios to revalue and automatically update their current market value.
Page Name |
Definition Name |
Navigation |
Usage |
Portfolio Revaluation |
MTM_RUN_CNTL_PNL |
Risk Management, Reevaluate Deals, Portfolio Revaluation, Portfolio Revaluation |
Run the Portfolio Revaluation batch process to run analytic calculations on your portfolios and revalue their current market value. |