What is the AXIS Daily Hedging Module used for?
It supports dynamic hedging programs by providing up-to-date hedge analytics and sensitivities (Greeks) for portfolios of Variable Annuities (VA) and Segregated Fund Annuities.
What type of analytics does the Daily Hedging Module produce?
It produces up-to-date hedge analytics including the typical Greeks such as Delta, Gamma, Vega, Rho, and Theta, specific to GMXB benefits.
What are GMXB benefits?
Guaranteed Minimum Benefit features in Variable Annuities, including death, income, withdrawal, and accumulation guarantees.
What is the purpose of calculating Greeks in the Daily Hedging Module?
Greeks measure the sensitivity of guarantee values to changes in market factors, helping actuaries manage and adjust hedge positions daily.
How does the Daily Hedging Module relate to the Hedge Projection Module?
It is a companion module that provides real-time or daily analytics, while the Hedge Projection Module focuses on projecting hedge effectiveness over longer time horizons.
How is the Daily Hedging Module integrated within AXIS?
It is fully integrated with the AXIS Annuity module and shares common code and models across the AXIS system.
What types of products can be modeled using the Daily Hedging Module?
Portfolios of Variable Annuities and Segregated Fund Annuities with guaranteed benefits.
Why is the Daily Hedging Module important for risk management?
It allows insurers to monitor hedge effectiveness, measure current exposures, and rebalance hedge positions in response to market changes.
What is meant by ‘dynamic hedging’ in the context of AXIS?
A risk management strategy that continuously adjusts hedge positions to offset changes in exposure due to fluctuating market conditions.
What advantage does full AXIS integration offer for the Daily Hedging Module?
It ensures consistent modeling assumptions, data sources, and valuation methods across all modules, improving accuracy and efficiency.
