Do you know which traders are hedging against you at other brokers?
For many brokers, just 1% of clients can be responsible for the majority of losses, often through coordinated strategies involving negative balance protection abuse, bonus abuse, and swap abuse. Until now, identifying these traders has been difficult.
With iSAM Radar's Network Alerts, brokers can visualise how the same underlying trader uses multiple accounts across the Radar network to build and maintain hedged positions over time.
Outlined in our recent thought piece: Hedged and Hidden: The Coordinated Strategies Draining Retail Broker P&L, systematic abusers regularly require hedged positions for their strategies. With Radar’s Network Alerts, brokers can now be alerted directly to their communication channel when a trader has opened a hedged position using any account on the Radar network, whether it’s at your brokerage or a different one.
The visualization tools now in Network Alerts are fast and clear for brokers to identify those clients who are employing abusive methods, allowing them to quickly filter out brief and spurious hedged positions that don't have the same underlying danger.
Network Alerts is designed with transparency in mind to align with Radar’s purpose: to provide risk and dealing teams a comprehensive and timely understanding of their trader base, to identify those clients likely to extract PnL from their brokerage before it’s too late.
A summary of the information visible with Radar’s Hedged Network Alerts screen:
- Visualization of hedged positions at your brokerage and anonymized positions held by accounts at other brokers.
- 1-week historical lookback of all hedged positions for each cluster of accounts owned by the same underlying trader.
- The clusters longest hedged, its net and gross position, and whether it is still currently hedged.
This announcement of improvements made to Radar’s Network Alert’s follows last week's news that 4 new features have been implemented into Radar: iSAM Securities Accelerates Radar Development with Four New Risk Management Features, which are now giving dealing and risk teams a clearer view of exposure, related accounts and positions held with liquidity providers.
