Reglator

Definition

Design space

A design space is the set of viable configurations that would achieve the same commercial objective, each with its own regulatory consequences.

In short

What is design space?

A design space is the set of viable configurations that would achieve the same commercial objective, each with its own regulatory consequences.

Most institutions arrive at a decision with one design already drafted and ask whether it is permitted. The more useful framing is to enumerate the two or three configurations that would work commercially and compare what each would change.

The design space is where the leverage sits. Structure, counterparty, asset custody, customer proposition and geography can each be varied, and varying them changes the position more than any amount of documentation does.