Generating Technological Alpha: How Fintech is Reshaping the Asset Management Industry
Financial services has unquestionably been impacted by the proliferation of technology and, as a result, companies have been forced to reassess their operational processes and procedures to keep pace.
At the intersection of finance and technology lies fintech, a phenomenon that has improved and accelerated the evolution of financial products and services and the platforms that support their delivery. Fintech continues to be a growing sector with PwC’s recent Global Fintech Report noting that funding of fintech start-ups more than doubled in 2015, reaching US$12.2 billion and expectations that investments will exceed US$150 billion in the next three years. Thus far, the emergence of fintech has had the greatest impact on the consumer banking and payments sectors, though investment and wealth managers are next in line to experience the second wave of disruption.
Maples Fund Services’ Head of Data Management, Mark Weir recently moderated a panel at the KNect 365 UCITS & AIFMD Conference in London where participants described the increasing sophistication of data analytics and the disruption these advancements have brought to the asset management industry.
"As recently as ten years ago, patterns in market behaviour were judged on the data input from no more than 100 data points that could take days to collect, today that has increased to nearly 20 billion data points that can be processed in less than an hour’s time. Collecting and processing reams of data also no longer requires hundreds of people, instead it can now be handled simply through advanced software that is available to all," said John Ricciardi, Founding Partner at Kestrel Investment Partners. "This has presented small and emerging managers with significant advantages and an opportunity to close the gap between themselves and the industry’s larger and more established players."
The increased sophistication of data analytics, in particular, has had a transformative effect on the investment industry and has enabled managers to deliver tailored products and services. Additionally, innovations in the industry – such as the emergence of marketplace lending – are providing managers and their investors with access to asset classes that were formerly unavailable. Perhaps most important to investment and wealth managers is the ever growing importance of and demand from investors and regulators for greater transparency and intuitive risk and performance reporting.
Through continuous innovation, Maples Fund Services has developed an optimal balance of industry leading systems with bespoke proprietary solutions. While these best-of-breed core systems provide "beta," our internal resources concentrate on the generation of "technological alpha," allowing us to be dynamic in responding to our clients needs as they evolve. As a result, we are able to provide our clients with solutions that create value, enhance effective management and allow them to make more informed decisions.
Backed by this robust infrastructure, Maples Fund Services delivers comprehensive and specific reporting that captures key data and metrics accurately in a clear and insightful manner. In addition, we acknowledge that a "one-size-fits-all" approach to analytics often results in unnecessary complexity and meaningless reporting. Our customisable reporting ensures that the individual needs of each client are met and that the report truly supports enhanced investment decision-making and portfolio monitoring and oversight.