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Today's complex life insurance products require sophisticated financial risk management strategies to maintain their profitability. Milliman's proprietary MG-Hedge™ system offers clients robust data for risk analysis and hedging of market exposure.

The MG-Hedge system contains a market scenario generator capable of projecting thousands of possible paths, using either the "realistic scenario" or risk-neutral methods. Our system is exceptional in that it uses actual portfolio data, not an aggregation of data from which assumptions are drawn. As a result, the output provides more precise forecasting to determine the best hedging strategy for a client's specific needs.

Complex modelling reveals greater range of outcomes

MG-Hedge can use more than one calculation method, such as stochastic volatility or stochastic-on-stochastic calculations, to gauge the entire range of possible outcomes to a particular hedging strategy. We are able to design customised versions of the tool to reflect correlations between a wide variety of market factors, such as the possible interactions caused by changes in multiple economies around the world.

Milliman consultants have used the MG-Hedge system to help guide clients' risk management decisions for more than a decade. The system is designed and supported by our highly experienced, multidisciplinary team of capital-markets professionals, actuaries, and software engineers.