Planning/Analysis Functions in Market Risk

Management
The topics in this section describe the planning and analysis functions offered by Market Risk
Management, including:

 incorporation of fictitious transactions in the real position of financial transactions and

transactions from operating business.

 identification of impact of different trading and hedging strategies on the net present
value, effective interest rate/effective rate of the real position of financial and operative
transactions by incorporating fictitious transactions.

 simulation, i.e. calculation based on assumptions about future market trends.

 identification of cash flows, currency exposure and interest rate exposure taking
account of fictitious transactions and various market data scenarios.

The planning/analysis functions are divided into two sections:

 Planning/Analysis of Treasury Positions without Underlying Transactions

These functions cover financial transactions in your Treasury position.

 Planning/Analysis of Treasury Positions with Underlying Transactions

These functions cover the transactions in your Treasury position in addition to the
transactions resulting from your company’s everyday operating business.

Unlike the analysis/planning part of the application, the evaluation area offers purely reporting
functions on the basis of real transactions (see Information System: Evaluation Functions in
Market Risk Management).