Risk management software provider Risk101 has launched a new risk management product into Europe and the UK, anticipating double digit growth in carbon trading as asset managers, hedge funds and pension funds increasingly invest in socially responsible and renewable energy securities.

The new product, Ozone3, is designed to assist fund managers trading in both the primary and secondary carbon markets.

For the secondary market, it aims to help fund managers assess their exposure to carbon related securities including Certified Emission Reductions, EU Emission Allowances and their associated derivatives, as well as energy related commodities such as oil and electricity futures.

Ozone3 also aims to enable managers to manage investments and exposures in the primary market, which covers projects designed to meet the Clean Development Mechanism and other verification standards. Risk101 says projects can then be categorised - and exposures isolated - by country, currency, methodology (wind, solar, biogas etc) or user-defined categories.

Risk101 founder and chief executive Jonathan Ellenberger said that while volumes in the global carbon-trading market saw a slowdown in 2010, they have grown rapidly since the market’s inception in 2005 and are widely expected to rise again in 2011.

“There will be a greater need than ever for a simplification of sophisticated information to asset managers, group treasurers and investors. In the wake of the financial crisis, there is a new emphasis on risk management that has led many asset managers to take another look at their IT strategy. They want to implement more robust front-to-back risk and portfolio management systems that can handle new products, new regulation and new customer reporting and service levels,” Ellenberger said.

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