UMB launches direct portfolio access for hedge fund clients

Jill Calton, UMB

Hedge fund clients now have direct access to their data through a new online portfolio reporting tool introduced by UMB Fund Services. The portal is intuitive yet comprehensive, providing hedge fund clients with the information they need to analyse investments.

Jill Calton, senior vice president, executive director alternative investments at UMB, elaborates on the process which led to the launch of this portal. “Our hedge fund clients generate large amounts of data. In the past, we provided clients’ reports containing investment data and individually responded to ad hoc requests for portfolio information,” she explains.

This portal represents the closing of that gap as clients now have direct visibility to everything UMB captures, maintains and processes for them as an administrator. “We are offering clients full transparency and data access to their fund information. They have access to everything: the portfolio, their trading activity, positions they hold, fund information, investor information and financial reporting,” Calton says. 

UMB believes every general partner or fund manager using a third-party administrator should expect the ability to access their underlying information. Calton adds: “For us, it’s about meeting our clients’ needs and making sure we are providing a competitive, top-tier solution.”

Information and transparency demand on hedge funds are on the rise and a portal like this allows clients to run reports themselves without having to wait for support from their administrator. Calton stresses: “We understand hedge funds are navigating demands placed on them by their underlying investors; they want more transparency, quicker turnaround times and specific and detailed information about their investments.” Having this data available any time can help bolster a streamlined relationship between hedge funds and their investors.

A key factor of this particular development is that UMB has chosen to absorb the cost of the new capability. “We understand technology is key to providing valuable service to our clients—that’s why we’ve made the investment,” Calton comments, “It will help UMB be more efficient as well. The fact that we are not passing any of the cost to our clients or their investors is unique. We acknowledge it is a value-add for both parties.” 

Looking ahead beyond the launch, UMB has plans to continually improve and enhance what has already been built. Calton explains the firm is in the process of launching a second phase, which will go live in 2020. Future enhancements will enable clients to see their performance with comparisons to various indices.

Fund administrators are stewards of their clients’ data and thus, they are responsible for accuracy and security. Cyber security is climbing up hedge funds’ priority list as regulators are beginning to take a closer look at the infrastructure needed to ensure the right systems are in place to protect investor data. Having access through an online portal not only allows hedge funds to benefit from the security technology provided by UMB, but also eliminates certain processes which could expose them to a higher risk of a data breach. For example, UMB’s hedge fund clients no longer need to rely on email for delivery of reports, since these can now be generated through the portal.

Detailing the rationale for UMB’s investment in technology, Calton says: “Overall, what is important to us is that we have systems which allow for the workflow to happen efficiently and automatically. At UMB our fund accounting process is managed within two main systems which is unique. Limiting the number of systems allows us to maximise efficiency without increasing risk. We want to offer our clients quality platforms which also allow us to be the most efficient. We then pass that value on to our clients through more competitive fees.”

The firm is highly cognisant of the challenges its clients face and part of its mission is to help them navigate these headwinds. In her opening statement at UMB’s Market Insight conference in October of last year, Calton pointed out the industry is experiencing unprecedented, rapid evolution which has made the ability to adapt critical. This shifting landscape, and the challenges that come with it, is being exacerbated by trends such as industry consolidation and fee compression.

Giving hedge fund clients full data access through this online portal is one way UMB is adapting to change and in turn helping its clients do the same.

Calton concludes: “Technology in general can be a challenge; if you aren’t committed to continual investments, you’ll quickly find that your offering is outdated.  The new portal is instrumental as we partner with our hedge fund clients in the digital age and is a significant milestone in our mission to advance technologically. UMB is focused on providing technology solutions for our clients as the private fund space evolves. We strive to continuously improve our offering by actively seeking out tools such as this to increase efficiency and add value for our clients. We are energised as we integrate technology initiatives with our commitment to client service.  

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