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What is Intraday Risk and What is True Real-Time Risk?

11 Sep 13

You need to service customers and employees on mobile devices such as browsers, tablets and smartphones with live, dynamic information. But within the financial services industry (amongst many other industries) this has elements of risk. Organizations require a way to harness real-time information and deliver it out to your workforce, partners, customers or parties of interest to mitigate risk.

So how exactly can you determine the difference between what is marketed as intraday risk and what is true real-time risk? Let’s look at the banking industry.

In this industry “real-time data” enables greater price execution assurance for buyers and sellers of securities. Users are as close to the book price as possible and are more confident of hitting the orders they intend when acting on real-time data so reducing latency in delivering data reduces expose to risk.

Banks require access to liquidity intraday (end of day) in order to settle obligations in payment and settlement systems.  After Lehman Brothers Holdings Inc. filed for Chapter 11 bankruptcy, evidence presented in the Valukas report suggests that a lack of liquidity turned out to be one of the key elements that precipitated the firm’s collapse: on 14 September 2008, Lehman no longer had sufficient available liquidity to fund its daily operations. A significant factor in Lehman’s shortage of liquidity was the provision of collateral to its clearing banks to fund its intraday liquidity positions. Monitoring this activity in real-time would have exposed this problem instantly and enabled positive action to be taken.

This is an extreme case, but the reality is that if you can understand your risk exposure in real-time, you’ll be better placed to protect the organization.

The Diffusion Intelligent Data Platform manages, optimizes, and integrates data among devices, systems, and applications. Push Technology pioneered and is the sole provider of real-time delta-data streaming™ technology that powers mission-critical business applications worldwide. Leading brands use Push Technology to fuel revenue growth, customer engagement, and business operations. The products, Diffusion® and Diffusion Cloud™, are available on-premise, in-the-cloud, or in a hybrid configuration, to fit the specific business and infrastructure requirements of the applications operating in today’s mobile obsessed, everything connected world. Learn how Push Technology can reduce infrastructure costs, and increase speed, efficiency, and reliability, of your web, mobile, and IoT application.

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