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Standard & Poors launches valuation scenario services

Date: Tuesday, January 20, 2009
Author: Hedgeweek.com

Financial market information provider Standard & Poor's has announced the launch of valuation scenario services for structured asset portfolios, which aim to help investors evaluate the intrinsic value of structured assets and complex securities.

The service is provided by Standard & Poor's fixed-income risk management services business.

The business is already working with a number of central banks, regulatory and industry bodies, as well as investors, to help them value complex and illiquid securities.

The analytics provided by Standard & Poor's valuation scenario services offer investors a step-by-step, transparent assessment of their structured portfolios under a range of different assumptions and economic scenarios.

This information is then reviewed with clients to help drive an improved understanding of structured credit portfolio value. Standard & Poor's valuation scenario services operate independently from the company's ratings business.

'Market uncertainty, a lack of liquidity and an overall crisis sentiment are combining to create a disrupted relationship between market-observed pricing and the intrinsic value of structured assets on investors' balance sheets,' says Lou Eccleston, executive managing director for fixed-income risk management services at Standard & Poor's.

'Our valuation scenario services help investors analyze their portfolios against a multitude of potential economic scenarios to get a much clearer picture of the real value of the paper they are holding.'

Standard & Poor's valuation scenario services are supported by the market, credit and risk strategies team, a newly formed, independent research group that analyses cross-market and cross-asset class valuations and relationships, the Standard & Poor's structured finance platform and modelling team, and the fixed income architects team.