Investment management industry hindered by ‘inflexible’ portfolio management systems finds new white paper from Eagle Investment Systems and Waters Technology

Boston, MA - 31 January 2014

  • One-in-four data managers dissatisfied with current portfolio management solution 
  • Effective management of data required to produce IBOR is ‘out of reach’ for nearly one-third of investment managers 

Inflexible portfolio management infrastructures are hindering investment management companies’ ability to adapt to organizational and market changes, according to a new white paper sponsored by Eagle Investment Systems LLC (Eagle), a leading provider of financial services technology and a subsidiary of BNY Mellon.

The white paper, A Data-Centric Approach to Portfolio Management, was released by Waters Technology and based on survey responses from senior executives at investment management companies and asset managers who assessed current practices around Investment Book of Record (IBOR) and portfolio management. 
The white paper can be downloaded at HERE.

The paper reveals that nearly half of the survey respondents believe it is presently quite difficult to adapt their organization’s portfolio management infrastructure in the face of changing internal or external environments such as the integration of new systems, expansion into new product areas or asset classes, and changing rules and regulations or market trends.

The survey exposes that a quarter of data managers are not satisfied with their current portfolio management solution when it comes to sourcing, organizing and managing data.

The paper also discloses that more than half of organizations still use several different systems to compile an IBOR, potentially leading to inaccurate data and increased operational complexity.  These companies are using anywhere between two and eight systems to complete the process of generating an IBOR.

“Our research reveals the difficulties many investment firms face and the importance of data management when it comes to efficiently and accurately managing portfolios,” said Mal Cullen, Eagle managing director and head of the Americas and Eagle ACCESSSM.  “Many use numerous systems that they’ve either inherited through acquisitions or bolted-on as they’ve added new products or entered new geographies.  This inevitably affects the speed and accuracy of reporting and decision-making.”

“Firms should consider adopting a data-centric approach to their portfolio management and IBOR, where the investment data for all assets is available through a single, centralized database,” Cullen added.

In recent years, IBOR has emerged as a valuable tool for investment managers, both in handling the abundance of information and meeting new financial regulations.  An IBOR uses information gathered from across the business to provide a consistent and accurate overview of a company’s assets for enterprise-wide consumption. 

However, where underlying information is siloed, by asset class or geography for example, and multiple systems are used, producing an accurate IBOR can become hugely time-consuming and fraught with difficulty.  This has led to nearly one-in-three data managers concluding that effective management of the data required to produce an IBOR for their organization remains out of reach.

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