Edison evaluates counterparty risk in the financial services sector through analysis of the demands and challenges of Credit Valuation Adjustment (CVA). The report explores the advantages and business value Cray® XC™ Series Supercomputer architecture featuring Intel processors delivers in solving these demands over commodity hardware. In an accompanying infographic, Edison illustrates the architectural differences and resulting total cost of ownership advantages.

Executive Summary

Credit Valuation Adjustment (CVA) evaluation activity in financial institutions has seen an increase in demand and complexity, which is driving the need for improved infrastructures.

One driver for this is the increase in regulation and reporting requirements since the credit crisis of 2008. To mitigate the impact, banks must try to decrease the cost of compliance while using required regulatory calculations to better monitor and manage risk within the firm. CVA is an example of this: Whole portfolio CVA is done as a compliance mandate, but many firms leverage this not only to manage risk but also to actively internally trade CVA.

To keep up and stay competitive, firms are thus forced to reevaluate their grid infrastructure strategies and are investigating high performance computing (HPC) solutions that can more cost-effectively provide better performance than the traditional grid solutions. We believe that the Cray® XC™ series supercomputer gives firms an opportunity to significantly flatten the cost curve of core expansion by reducing TCO and enabling development agility.

For the full paper click here.

For the infographic click here.