Note from the Publisher: The following press release on a new report published by Tabb Group surveyed investment managers outside of North America. They found that insufficient trading architecture resulted in comprOMised revenue of up to 50% and also inadequately addressed risk and compliance reporting. Interesting read.
NEW YORK and LONDON, July 05, 2016 (GLOBE NEWSWIRE) — The choices that investment managers make about their IT architecture can impact their success or failure to compete for market share. TABB Group’s latest research, “The Buy-side Legacy IT Hangover: Finding the Cure for Alpha, Compliance and Growth,” details a survey of global non-North American investment managers revealing that participants recognize trade delays caused by inadequate technology account for opportunity costs of anywhere up to 50% of revenue. The risk of not meeting the needs of both clients and regulators means loss of assets, potentially incurring large fines and not sustaining profitability and growth.
In the report, TABB senior analyst Dayle Scher reveals how non-North American investment managers are approaching their technology needs and what the resulting impacts are. Scher explains that as investment organizations pursue new clients and new asset classes, the supporting IT infrastructure must be able to support growth, compliance and scale.
Though there are notable differences between global investment managers and their North American counterparts TABB previously surveyed, there is an overarching universal need to attract assets with an integrated technology approach. Although TABB found one third of asset managers outside of North America have adopted a single vendor, single platform technology, there are still a number of prominent hurdles to overcome. A sampling of the findings of Scher’s outreach is as follows:
- 30% of asset managers outside of North America continue to maintain legacy platforms despite the fact that the technology plays a contributing role in causing trade delays and errors.
- Almost 20% of non-North American buy-side firms spend more than an hour a day rectifying errors that result from manual processes.
- Half of investment management firms experience technical problems in executing pre-trade compliance checks, exposing them to avoidable financial and reputational risks.
“An increasing number of rules and regulations are putting the squeeze on asset managers across the globe to be compliant,” said Scher. “The main reason for firms missing the mark on pre-trade compliance checks is the lack of integration and consistent data cross systems. In fact, nearly 40% of our survey respondents who had issues with compliance checks cited lack of integration as the cause.”
The 19-page, 10-exhibit report can be downloaded by TABB’s Research Alliance financial technology clients and pre-qualified media at https://research.tabbgroup.com/search/grid. For more information or to purchase the report, contact [email protected]
About TABB Group
With offices in New York and London, TABB Group is the international research and consulting firm focused exclusively on capital markets, based on the interview-based, “first-person knowledge” research methodology developed by Larry Tabb. For more information, visit www.tabbgroup.com.