Risk providers respond (part four): Can you do it all with just one model?

In this installment of our series with risk model providers, we ask if one model can truly capture the nuances of risk for equity-only, fixed income, and blended portfolios.

Can one model provide a detailed view of risk? Our featured speakers offer insight into multiple model and single model strategies.

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Some highlights from our episode:

Jason MacQueen, one of the founders of R-Squared

"The short answer would be yes, but that's a misleading answer...although you could call it a single risk model, what it actually is a number of different risk models bolted together."

Oleg Ruban, Senior Associate of Applied Research and Patrick D'Orey, Vice President, Head of Europe Equity Analytics of MSCI Barra

"You need to find a way to robustly combine these different models into a single model that allows you to look at the risk of your entire portfolio."

Dan diBartolomeo, President and founder of Northfield Information Services

"If the goal is to have the assessment of risk across an entire enterprise...there's no statistically legitimate way in my view to take fifty different risk models with fifty different sets of factors and somehow try to aggregate that information together. There's just too many moving parts..."

Laurence Wormald, Head of Research, Sungard APT

"We believe in supporting specialists with models that are dedicated to their asset class....We're following our clients, we have a global multi-asset class model.  But there are those who have specialist needs..."

"The key again has to do with the flexibility of attribution that can be provided."

Sebastian Ceria, CEO and Olivier D'Assier, Managing Director for the EU and Asian Markets of Axioma

"We're big believers in multiple models. If you just restrict yourself to equities for the moment, we believe that having both a statistical as well as a fundamental model can help you better understand risk.