DBFS has enhanced the planning functionality of Asset+, its front to back office platform for managers running hedge funds, fund of hedge funds and asset management portfolios.
Fund of hedge funds investors are beginning to demand greater transparency to ensure that managers are truly capturing alpha rather than providing a diluted beta. The requirement to deliver steady monthly returns with low volatility has to some extent led to some managers choosing arbitrage strategies that profit from price convergence whilst ignoring the fat tail risks associated with market downturns.
Asset+ has enhanced its modelling capabilities to enable users to better quantify such risks.
The new functionality enables clients to build hypothetical portfolios and run them on a historical basis to see the effects on returns, both in percentage terms and by attributing those returns across different strategies. It also enables investment managers to look forward by running multiple scenarios to forecast the effects on their cash position. In tandem the management and tracking of liquidity has been enhanced, permitting managers to run scenarios and if desired, to trade directly from the new liquidity GUI.
'Investors are demanding greater transparency and enhanced risk management. The requirements to meld stress testing and scenario planning with cash and liquidity management can only be achieved by running a single multidimensional data warehouse, running off multiple spreadsheets or systems is becoming increasingly difficult' said Brian McNulty (pictured) DBFS's CEO. 'This kind of functionality assists our clients with planning and key decision making.'