Numerix, the provider of pricing and risk models, today announced that they would be allowing Bloomberg Professional users to access their data. Covering Fixed Income, Credit, ForEx, and Equity Derivatives this will allow Bloomberg subscribers access to a wide variety of risk and pricing models for these OTC derivatives. In essence Numerix have embedded the latest version of their software (version 6) into the Bloomberg service calculators, giving users a wide range of tools and models that they would otherwise have had to either create themselves or buy separately from other suppliers. Numerix covers a huge range of models across the OTC universe including the usual suspects (i.e. Black Scholes) and all the derivations thereof, as well as some of the more weird and wonderful ones such as Fourier/Laplace transforms for credit structures.

Let's be honest. This is a massive boon for both companies. I have always admired the Numerix offering, but it has often struggled to break into the buyside as managers struggle to come to terms with the need for this "quantishness". Using Bloomberg as a conduit for its output however will radically change this - after all so much of the differences involved in the trading of derivatives for buysiders is about education and comfort. For Bloomberg too this is a great move I think. They have always struggled to find the right position for themselves in the OTC world - yes they have SwapTrader and most of the less complex data - but traders have always needed a raft of other applications/spreadsheets to cover out the more complex requirements. Utilising Numerix like this partially fills one these gaps and can only be a good thing for them.