Name: Understand Your Counterparty Risk
Brand: linkedin.com
SKU: linkedin-com-5
Availability: OnlineOnly

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Understand Your Counterparty Risk

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Recently it has been that Boots, along with other high street retailers, have failed to make rent payments to their real estate landlords. This is the clearest sign yet that it is no longer "Business As Usual" for everyone in the commercial world, as companies experience numerous challenges managing their cash flow. It is important to note that every company is exposed to counterparty risk&nbsp;- a possibility&nbsp;that your&nbsp;counterparty&nbsp;in a transaction cannot fulfill its obligation to you.Inherently every consumer, every individual, is also exposed to counterparty risk. For example, my friends are waiting for a refund from an airline after cancellations, my wife recently had an internet order cancelled because her order cannot be fulfilled and we all expect to be paid our salaries at the end of the month.These examples clearly demonstrate that we are all exposed. This is underpinned by many factors and is of varying monetary importance, depending on our own specific situation. Hence, it is important for us to not take things for granted and carefully assess our own individual situation.If you are a company - in particular, if you are selling to other businesses - you have a number of counterparties with whom you are contractually engaged with or intend to be. As explained above, this naturally creates risk of the other side failing to fulfil their obligations. A good example of this can be future payment of invoices, which results in potential credit risk or contracts being terminated early. helps you better manage these risks. It monitors various risks of every company in the UK. You can quickly understand the average risk score across your list of companies and the monetary value this risk represents.Visualisations on the page can quickly highlight the companies with the largest risk exposure, as their significance is reduced on a "risk-adjusted" basis compared to an "absolute" exposure.The underlying risk factors for the list of companies can be explored on the page. Here visualisations help to understand the most important factors driving the risk score. The corresponding monetary amounts of each factor are also provided for insight. Overall, this information can assist with the exploration of opportunities available for hedging these risks.The page allows you to further drill down into the detail of each company. The correlation matrix highlights the level of risk score similarity among the companies in the list. An orange colour indicates companies with an opposing risk profile, due to a negative correlation, and the diversification among your counterparties. A blue colour signifies similar risk profiles and a likely risk concentration, due to positive correlation.Each company also has its own page, where risk information can be explored in more detail. Visualisations highlight the importance of each risk factor and their corresponding monetary significance. General company information from Companies House is also provided.To learn more about and how it can help you better manage your counterparty risk exposure during the Coronavirus crisis, please get in touch with&nbsp;&nbsp;directly on LinkedIn or via email: dmitry [at] rastorguev.co.ukTo view or add a comment,

Recently it has been that Boots, along with other high street retailers, have failed to make rent payments to their real estate landlords. This is the clearest sign yet that it is no longer "Business As Usual" for everyone in the commercial world, as companies experience numerous challenges managing their cash flow. It is important to note that every company is exposed to counterparty risk&nbsp;- a possibility&nbsp;that your&nbsp;counterparty&nbsp;in a transaction cannot fulfill its obligation to you.Inherently every consumer, every individual, is also exposed to counterparty risk. For...

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⭐️ Dmitry Rastorguev

linkedin.com

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