A new reporting engine with OMS connectivity
"Emerging managers under the USD200million AuM mark struggle to get the necessary reporting needs from their service providers because of the high cost of ownership,” explains Scott Price, Regional Director, Americas, Custom House Global Fund Services, one of the industry’s leading hedge fund administrators.
“We’ve developed a platform that is scalable and cost sensitive for the underlying managers. It’s ideal for managers who want to leverage the infrastructure of its administrators to deliver daily reconciled portfolio reporting and as well risk and advanced P&L to their investors.”
The platform in question is Custom House Gateway, due to be hard launched this September. In brief, the platform gives managers and investors a single point of access to a wide range of middle- and back-office reporting needs. Every day, the system pulls in trade information from brokers and custodians and displays it through an interactive dashboard along with key performance indicators, statistical information and risk analytics.
Scalability is one of Gateway’s key attributes. “If a manager needs daily reporting and six months later he branches out to use an additional prime broker, it’s very easy to capture that additional data. Gateway breaks down risk reporting by counterparties, market sectors etc. This brings added flexibility,” explains Price.
One unique feature of Gateway is its integration with an Order Management System. This means trade data is captured in real time before individual orders are executed with the primes, providing enhanced real-time reporting. Investors and managers alike can log on to the Gateway platform and get an up-to-date snapshot of the portfolio.
This is particularly attractive when Price confirms that Gateway is fully iPad enabled.
“It really assists in managers’ marketing efforts. They can attend a conference or roundtable and show potential investors how a third party is assisting their firm in managing risk. This helps with the due diligence process because it demonstrates that they’ve partnered with an institutional service provider that allows them to keep their operating costs under control.”
Cost pressures are something that managers are all too well aware of. The fact that Gateway is a cloud-based technology that plugs directly into their daily fund operation is compelling because today’s start-up manager increasingly wants to outsource functions and keep their in-house tech spend to a minimum.
“Managers are demanding, ‘We want a cloud-hosted solution, we want our primes and administrator to be able to interchange and communicate data as seamlessly as possible using FIX technology’. We’re seeing this trend in the US where the majority of back office functions are being outsourced,” observes Price.
Capturing data and presenting it in the right format has become critical as today’s hedge fund managers face regulatory and investor reporting demands. Price says: “With US and European regulation it’s only going to mean one thing: management companies will need to prove that they have a stable operating model to make reporting more efficient. Gateway provides that.”
However, Gateway is not just a portal for managers and investors. Fund directors, auditors, tax partners: they all have access to relevant reports, further underscoring the scalable benefits that Gateway offers.
“Various stakeholders are going to need increasing access to data. Whoever that is, we will make a single point of access to Gateway that is fully adaptive to change in line with the industry,” concludes Price.
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