Inst'l Investors Demand Better Data from Hedge Funds
by Abacus Group, on Mar 16, 2014
March 5, 2014 by Alex Padalka, Fundfire
An ever-expanding universe of products, pressure from institutional investors, and regulatory demands have driven hedge funds to seek better data management. Many hedge funds are investing heavily already, training internal staff and working with vendors, and those lagging will see their competitive edge eroding away.
Quantitatively-oriented hedge funds have been at the forefront of investing in high-quality data, says Sam Auxier, a principal with Deloitte. But now "even less tech-oriented funds are spending a fair amount of time and dollars making sure their data warehouses and security masters and portfolio accounting systems have high-quality data," he says.
While regulation such as AIFMD, FATCA, Form PF and Form PQR require data-centric solutions of some kind – a Deloitte reports finds the real drive for better data comes from investor demands for more flexibility, more breadth and variety of reports, as well as transparency in reporting, according to Auxier. From the regulatory side, hedge funds try meet those demands "as cheaply and as simply as possible," says Art Murphy, director of client development for Abacus Group.
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