Benefits of Investment Operations towards Digital Asset Management

CIO Review Europe | Monday, December 28, 2020

“Modernising operations for various assets and product categories through the use of scalable technologies for core tasks and optimisation not only reduces costs but also gives organisations more time to focus on value-generating activities.” 

Fremont, CA: In the past, asset managers were primarily concerned with increasing scale and efficiencies in their investment operations. Many businesses are now adopting a new strategy. What are its priorities? Using digital as a driving force to increase revenue, client centricity, and market share. To do so successfully, organisations must adopt a new way of working and thinking about investment operations.

Let’s dive deeper to understand the main areas of investment operations by businesses in digital asset management.

1. Manual processing has historically been the standard for several complicated asset and product types, such as OTC derivatives. Because of their complexity, these assets generally fall outside of the industrial-strength, scalable frameworks that handle more common assets. However, this is changing as technology advances, allowing for new operational capabilities to support these items.  Modernising operations for various assets and product categories through the use of scalable technologies for core tasks and optimisation not only reduces costs but also gives organisations more time to focus on value-generating activities. 

2. Personalised and novel investment capabilities, such as separately managed accounts (SMAs), may become the norm, emphasising the need for real-time insights into individual portfolio behaviours. As a result, the analysis of investment operations teams would need to expand beyond single portfolios to include larger regional, strategy, client, and/or business holdings. Operations teams are utilising advanced technology to accomplish this as well as the capital markets talent and knowledge to make it a reality.

3. Currently, operations teams coordinate requests from investment management, but they do it in silos. As a result, a rising “service emphasis” is needed, which might play a crucial role in enabling greater coordination, faster turnaround, and a more seamless experience for internal consumers. For example, if investment management requires assistance in understanding foreign currency (FX) arrangements in target markets, ‘investment services’ may be able to give broad-based market expertise, direct communication with industry partners, and timely insights to the front office.

 

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