What is Resistance to Shocks (RtS)?

Resistance to Shocks is the capability of a business, a portfolio or a fund, to withstand disruptive and destabilising events in the markets, in the economy and in the geopolitical scenario.

 

How many RtS rating classes are there?

Conventional ratings have between 20 to 30 classes. RtS ratings are stratified into five classes.

 

How is an RtS rating measured?

RtS ratings are measured on a scale ranging from 0% to 100% Values below 50% generally reflect situations to be avoided.

 

Why is Resistance to Shocks important?

Because sustainable businesses and investments are those that can absorb the turbulence and instabilities of the markets and of the global economy.

 

Is a Probability of Default (PoD) rating still relevant?

Even though PoD ratings are still the standard, their relevance is questionable because of the highly unstable nature of the markets and of the global geopolitical scenario.

 

Why is an RtS rating an objective rating?

Because there are no humans in the loop. The system is fully automatic and cannot be manipulated. Our ratings are science, not opinions.

 

What can be rated using RtS ratings?

Companies (public and private), stocks, ETFs, futures, bonds, options, portfolios, funds, funds of funds, markets, national economies and systems of all of the above.

 

Is an RtS rating comparable to conventional ratings?

No. RtS ratings provide new information with respect to a PoD rating. RtS ratings, unlike conventional ratings, have been engineered specifically for a turbulent and volatile economy.

 

Why are RtS ratings free of conflict of interest?

For two reasons. First, Universal Ratings is an independent and privately owned company. Second, the algorithm powering RtS ratings cannot be manipulated.

 

How does one obtain an RtS rating?

It is sufficient to submit data (fundamentals, portfolio or fund performance) to our automatic B2B rating platform. Results are generated in near real-time and sent back to the client immediately.

 

How frequently can an RtS rating be computed?

When rating listed companies, RtS rating is performed on a quarterly basis. Portfolios, funds or other financial products can be rated as frequently as desired, even on a daily basis.

 

Which data sources are used to compute RtS ratings?

Universal Ratings can deliver ratings based on data from Bloomberg, Thomson Reuters or any other data source. Clients may, however, use proprietary data.

 

Does Universal Ratings store clients' ratings?

No. Nothing is stored, neither the input data nor the corresponding RtS ratings.

 

What if a client wishes to rate sensitive data?

The RtS rating engine does not need to know what each parameter in the client's data represents. Data can also be scaled before it is submitted for processing.

 

What is the main difference between RtS and PoD?

A Probability of Default is deprived of any physical meaning. A Resistance to Shocks, on the other hand, is a physical property which may be measured.

 

How is the RtS rating system priced?

Annual flat fee.

 

Where can I read more about RtS ratings?

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