Northern Trust has announced plans to offer funds of hedge funds daily portfolio management data, typically provided by administrators on a monthly basis and with limited detail, through a
Northern Trust has announced plans to offer funds of hedge funds daily portfolio management data, typically provided by administrators on a monthly basis and with limited detail, through a global partnership with UK-based financial applications company youDevise.
The partnership will see Northern Trust become the first global asset servicer to adopt youDevise’s Hedge Information Provider 2.0 product, an online portfolio management system developed specifically for funds of hedge funds, as part of its offering for the sector alongside fund administration, custody and trade execution, fiduciary and trustee services, foreign exchange and banking.
‘The combined Northern Trust-Hedge Information Provider solution represents a tremendous step forward in management information systems for the USD1.5trn global fund of hedge funds industry,’ said Wilson Leech, head of Northern Trust’s global fund services group.
Leech says the development comes at a particularly crucial time for the industry as it faces increasing demand from institutional investors for greater transparency, improved governance and detailed reporting.
Hedge Information Provider will be fully integrated into Northern Trust’s global technology platform to provide fund of hedge funds clients with daily information on their hedge fund holdings, current value, performance, liquidity and hedging as well as a detailed breakdown of assets and transactions. Information will be accessible through Northern Trust’s interactive web portal Passport, which offers secure access to account information and portfolio reports.
‘As a result of this integration, funds of hedge funds will no longer have to run shadow accounting and will have online access to data that will have been fully reconciled against, and integrated with, the official month-end NAV,’ says Peter Cherecwich, head of global product and strategy for Northern Trust’s asset servicing business. ‘This supports Northern Trust’s drive to offer comprehensive asset servicing capabilities to the global fund of hedge funds industry.’
Richard Koppel, managing director of youDevise, adds: ‘Hedge Information Provider will enable Northern Trust clients to make decisions faster and more effectively, take better advantage of market opportunities, and demonstrate to their institutional investors the level of control, reporting and transparency that they demand. It will also benefit funds of hedge funds by reducing the risks and inefficiencies associated with multiple data entry.’
The solution will assist funds of hedge funds’ portfolio management by tracking and evaluating investments in underlying funds, and their accounting functions by monitoring, reconciling and forecasting portfolio cash, payables/receivables and foreign exchange balances.
It also determines how much cash is redeemable from hedge funds over time and assists in carrying out sensitivity analysis on current and projected cash balances. The system calculates foreign exchange exposure and hedging needs and determines gains or losses on existing hedges, and offers front-office decision support by providing up to date cash, portfolio exposure and performance information to the portfolio manager.
Founded in 1889, Chicago-based Northern Trust provides investment management, asset and fund administration, fiduciary and banking services to corporations, institutions and affluent individuals through 85 offices in the US and 13 elsewhere in North America, Europe and the Asia-Pacific region. At the end of last year Northern Trust had assets of USD4.1trn under custody and assets under investment management of USD757.2bn.
London-based youDevise provides web-based portfolio workstations for financial markets. Its on-demand applications include the Trade Idea Monitor for the high-speed communication of equity trade and portfolio ideas between institutional brokers and their money manager and hedge fund clients.
