...
The following table defines terms to build up the structure of the Recursive Look Through approach.
Term | Description |
|---|---|
Asset | An asset is any possession that has value in exchange. |
Simple Asset | A simple asset can be adequately implemented as one dB row in a Security Master and Security Analytics for any given point in time. |
Examples
Examples: Stock, Bond, or Cash | |
Compound Asset | A compound asset is created from one or more financial instruments. A compound financial instrument can be composed of any combination and number of simple and/or compound assets. A compound asset is often called or can be thought of as |
Derivative (ex:
a Derivative (for example, Swap, Mutual Fund), Collection, or Portfolio ( |
for example, ETF, Mutual Fund) |
. Compound financial instruments are often treated as simple financial instruments in current systems. Doing so results in a loss of full analysis capability. | |
Positions and Portfolios | Based on the investor's assessment, the investor can take a position in assets - assets that are "trading cheap" are candidates for purchase. Assets that are overvalued, "trading rich" can be considered for sale, or if the asset is not already owned it can be "sold short." Positions can be taken - long or short. When an investor takes a position in one or more assets they create a portfolio. |
Composites | A composite is just a collection of portfolios. As such, a composite is also a portfolio. The essential difference with a composite is that the investor (firm) does not actually take positions in the composite. The investor (firm) actually holds the positions that are in the underlying portfolios. |
| Anchor | ||||
|---|---|---|---|---|
|
Entities are set up for look through using the SECURITY_MASTER_DETAIL table. This table is used to indicate that a security is actually compound (an entity that can have look through applied). To set up an entity as a compound security for look through, the following two columns must be set up in the SECURITY_MASTER_DETAIL table.
Column | Value | Description |
|---|---|---|
LOOK_THRU_IND | P | Treats the security as a compound security (P == Portfolio) |
LOOK_THRU_VALUE | Entity_id | The identifier of an entity that is set up to hold the components of the compound security. |
A pair of eyeglasses appears next to any security that has a LOOK_THRU_INDICATOR of 'P' set, as shown in the following figure.
...