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Bailey McCann, Opalesque New York:

Risk management has always been a core component of any trading strategy, as well as a critical part of business management. However, as macreconomic weakness persists, and alpha becomes increasingly hard to generate, risk management as emerged as a more prominent competitive metric. Last week, industry members gathered at the Professional Risk Managers international Association's (PRMIA) Risk Year in Review to discuss that evolution and risk factors for 2015.

Panelists noted that risk management is likely to continue evolving into a core metric for competitive advantage as the buyside works to deal with a challenging macroeconomic situation and an unclear market environment. Where risk management may have triggered a sell signal before, the risk group is now tasked with managing that as well as business risk and keeping traders in the loop on how this may impact strategy. This is in part due to the institutionalization of funds, as investor demand is making risk management a more high profile position. But it is also important as compliance concerns and unique market conditions put more pressure on hedge funds operationally.

Interest rates

Much of rest of the discussion focused on macroeconomic events including how a rise in interest rates in the US could effect markets. "We are likely to see interest rates rise middle of next year and we could see as many as three increases before the end of the year, accordin......................

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