THE PORTFOLIO SURGEON
SEE WHAT OTHERS MISS.
DESIGN WHAT WORKS.
The Portfolio Surgeon brings specialist expertise in hedging, derivatives and portfolio engineering.
THE PORTFOLIO SURGEON
FX
RATES
CREDIT
EQUITY
VOLATILITY
CAPITAL EFFICIENCY
The focus is the hedges, derivatives, funding and financial arrangements around portfolios, balance sheets and treasury requirements. Para Bellum doesn’t manage assets or sell products.
WHAT A PORTFOLIO SURGEON DOES
Financial markets are highly specialised. Most expertise sits within individual asset classes, desks and functions. Some situations don’t.
The work can cross FX, Rates, Credit, Equity and Volatility, as well as trading, structuring, portfolio management, risk, capital and financing.
It can also extend well beyond the transaction itself.
A mandate may involve derivatives documentation, counterparty credit, collateral, legal and compliance requirements, operational processes, finance and regulation.
None of those pieces operates in isolation. The challenge is seeing how they interact, where the constraints sit and what needs to happen to deliver the required outcome.
FROM THE TRANSACTION TO THE MACHINERY
The work does not stop at designing a hedge, structuring a transaction or building a programme.
Para Bellum can also build the capability around it.
That includes derivatives frameworks, governance, policies, operating processes, documentation, counterparty relationships, credit capacity and collateral arrangements.
Mike has built derivatives capabilities for major buy-side organisations, including negotiating ISDA, GMRA and CSA terms, establishing counterparty credit capacity and building the infrastructure required to support those programmes.
WHEN PARA BELLUM IS BROUGHT IN
Para Bellum is typically engaged when a team:
Needs a hedge designed or an existing hedge improved
Is building a new hedging or derivatives programme
Needs specialist input around financing or refinancing
Wants another set of eyes on a bank’s proposed solution
Needs to improve the use of capital, liquidity or collateral
Is unwinding, compressing or restructuring derivatives exposures
Needs additional hedging, derivatives or structuring expertise without making a permanent hire
Is building or enhancing derivatives and treasury capabilities
Has a requirement that needs experience the existing team does not have available
Sometimes there is a problem to solve.
Sometimes there is a requirement that needs to be designed properly at the outset.
HOW THE PORTFOLIO SURGEON WORKS
01 DIAGNOSE
Understand the exposures, requirements, constraints and objectives.
02 DESIGN
Build the hedge, programme, framework or solution.
03 IMPLEMENT
Put it in place alongside your banks and counterparties, and see it through.
04 TRANSFER
Leave the team with stronger capability than before.
PRACTICAL CONSTRAINTS
The practical constraints are part of the work from the start:
Liquidity, accounting, regulation, operational capacity, documentation and governance.
WHY “THE PORTFOLIO SURGEON”?
Surgeons are brought in for precision: a clear diagnosis, a decisive fix and nothing done for the sake of it. The same standard applies to a one-off hedge or an ongoing programme.
The work may involve trading, structuring, portfolio engineering, risk, capital, documentation, collateral, operations and counterparties at the same time.
The requirement may be straightforward, highly specialised or something that needs fixing. The value is in seeing the whole picture and knowing what needs to be done.
Sometimes the best time to bring in a specialist is before the important decisions are locked in.
WHERE THIS SHOWS UP IN PRACTICE
Underpins:
Hedge builds and hedge programme design
Portfolio engineering and overlays
Portfolio or trade restructuring
Balance sheet and capital efficiency
Treasury infrastructure and FX & Rates management
Derivatives structuring
Structuring-as-a-Service
Independent reviews
LET’S MAKE IT HAPPEN
Have a requirement, a decision to make or something you want to do better?