Managing a Stack of FCNs and Fighting Excel After Every Close?
If you manage quite a few FCNs (Fixed Coupon Notes), this scene will be familiar.
After the market closes, you open your market data terminal, then Excel. You look up closing prices one by one and check each term sheet: is today an observation date? Has it knocked out? Has a knock-in happened? How is this period's coupon calculated?
A few minutes per note means 50 notes is a fixed block of work every day, and:
Nothing can be missed, misrecorded or miscalculated.
The real problem: every FCN is slightly different
Some observe KO daily, others only on set dates; some have a non-call period, some have a KO with memory; KI may be an American barrier or only tested on specific dates.
What takes time is not understanding the rules, but applying the right prices to the right conditions every day and remembering the state of every note.
How long can Excel hold up?
- As the number of notes grows, one gets missed in the manual check
- When the person who maintains the sheet is on leave, nobody else understands the formulas
- Cross-date states such as KO, KI and memory are scattered across columns, and after a while you cannot trace how a result was reached
The real danger is not a broken formula, but:
The sheet still looks normal, yet one note's status stopped being updated correctly long ago.
Hand the daily repetitive checks to a system
Take over exactly the process people do by hand today: enter each term sheet's conditions when the note is booked, then after every close the system fetches market data, checks each note, calculates the period's result according to its terms, and notifies the person responsible whenever an important event is triggered.
Before: look up prices → fill in Excel → check the term sheet → decide → record → calculate
After: review the results → handle the exceptions
It does not predict the market or recommend which note to buy. It does one thing: repeat, accurately, the checks each term sheet requires every day.
How do you know the system is calculating correctly?
Take a few FCNs that have already matured, enter their term sheets and historical prices, and replay each one from issue date to maturity. Every KI, every KO and every coupon has to match.
You already know the answers — that is the best acceptance test there is.
If you are still spending that half hour every day
With only a few notes, Excel may be enough. But when someone spends fixed time on updates every day, the number of notes keeps growing, and only a few people understand the spreadsheet —
Isn't it time to hand this daily, rule-based work to a system?
tenet-O turns routine work held together by Excel and manual checks into systems that can be traced and verified. You do not have to start big — removing the step most likely to be missed is already valuable.
Excel is not the only thing that runs every day yet fewer and fewer people dare to touch. Another common example is the card-payment program:
Your NCCC card-payment program is in Java but your website isn't? Don't let it become a black box