After seeing the structure and power of our training models, Enstruct has consistently been asked by training clients about consulting services. Rather than solely offer those services through our training clients we are making them available for any organization. Our consulting services include:
- Model Verification and Auditing
- Custom Model Creation
- Third Party Systems Connectivity
- Reverse Engineering
Model Verification and Auditing
Working with another organization’s model can be more difficult than constructing a new one from the ground up. In order to gain and maintain confidence in another organization’s model, Enstruct offers model verification and auditing. This process includes a top down approach focusing on both technical and financial aspects. Technical analysis concentrates on the correctness of the functions, formulas, and connections throughout the model. Typos, incorrect function usage, and bugs are identified with recommended fixes. Financial analysis focuses on everything from basic accounting principle maintenance to transaction risk representation. After every cell has been audited detailed reports are created to identify problems and offer solutions. In addition, Enstruct can also work with clients to convert other models into existing formats that they may already work with. An example of an output report is shown below in Figure 1.
Custom Model Creation
Professionals at Enstruct have been part of many transactions and have experience with a variety of models including corporate, structured products, derivatives, and simulation based ones. Enstruct can be engaged on deals to create powerful, efficient models that clearly demonstrate risk and provide flexibility for users to utilize.
Third Party Systems Connectivity
Often times there are many existing analytical services or software that works very well for its specific task, but is difficult and cumbersome to integrate into a full product analysis. As an example in the field of structured finance many people use the Loan Performance database to calibrate performance assumptions, then use those assumptions in Intex to analyze deal performance, and then output results. Wrapping this entire framework up in a simulation is also often required. Enstruct works with consultants who have successfully provided third party systems connectivity that is extremely fast, efficient, and accurate.
As an investor in a deal or a third party to a transaction that has investment potential you will want the most detailed analysis possible. Enstruct has reconstructed deal models based on detailed and limited documentation to provide powerful tools for investment decisions. A recent example was a subprime auto securitization where the equity investor wanted the deal modeled on a loan level basis. The reversal and various scenario results were provided within two weeks of initial contact. A screenshot of one of the output charts is shown in Figure 2 below.
While the above services are the main ones provided, we can typically work with entities for custom solutions to problems. Please contact us to discuss any consulting type arrangement.