A proliferation of new products and new distribution channels along with increased demands for transparency have significantly altered the demands on the infrastructure of alternative asset managers.
That’s according to Convergence’s 2015 Alternative Asset Management Industry Update, which reveals that these trends lead to greater operating "complexity", which results in more process requirements and higher operating costs in order to address a higher level of operating risk.
The Alternative Asset Management Industry Update from Convergence also provides analysis and insight on:
• Overall Industry Growth
• Leadership and Staffing
• Business Complexity and Risk
• Industry Regulation
• Service Providers
• Operating Productivity
Convergence’s observations include that it is becoming increasingly common for investors and allocators to spend more time and attention on operations-related due diligence efforts. A proprietary method to collect and enrich data – the Convergence Complexity Index (CMDX-CI) – helps managers, investors and service providers understand levels of operating risk within and across managers of different sizes and investment styles. The CMDX-CI tracks 15 complexity factors that provide insight into the complexity of the Alternative Asset Manager and how those organisations compare to others in the industry with the same level of complexity.
This unique data and insight will allow managers and advisors to put increased focus on defining their current operating metrics, establish clear operations-related objectives, and see a clearer path to a company's growth plans.