Vidrio Blog

In their recently published investor update, Alternative Assets, H2 2020, Preqin reported that investors are not giving up on alternative assets and many expect to increase commitments.

In this post, Antonio Simonini, Vidrio's head of Client Services and member of our senior management team reflects on the effects of the current pandemic on the industry, Vidrio's own preparation and response, and the ways in which organizations can assess agility and resiliency of systems for whatever the future may hold.

When it comes to business continuity and infrastructure readiness, what does your new normal look like today, and are you preparing for whatever tomorrow’s “normal” may be?

For firms that desire continuity across all their teams, the multi-function single-vendor solution is a reasonable choice for the benefit of reporting alone. This level of centralization helps prevent discrepancies in data, reduces the drag of transferring information and work between systems, and promotes collaboration and transparency. The system dashboard becomes the information source for clients, prospects, and team members, instead of the limited data capture. This way, if you need more information to answer a question, you can do it in real-time.

One of the most widely used solutions capable of catering to an array of individual specialties is a combined patchwork of disparate tools and services for each functional need. While this approach seemingly allows allocation firms to leverage each area of expertise, it can be a hindrance to collaboration, accuracy, timeliness, and efficiency. Additionally, the costs can be insurmountable to set up all the necessary integrations and maintain with a growing staff and escalating service fees.

While there are trillions of dollars in the finance world managed on spreadsheets, there are a select few who choose to take on the task of creating their own custom-built software solution for portfolio management. 

The reasons to do so are the same as any other solution. 

• Sophisticated investors want a clear view of performance and risk across asset classes. 
• Robust data and analytics powered by software allow asset allocators to make better investment decisions. 

Spreadsheet software such as Excel may be the de facto system for financial institution's portfolio management, but should they be? With increasing staff, volumes of data, assets, and client responsibilities, spreadsheets quickly decay. The alignment between tables of information precariously poised on formula integrations and manual updates.

In the current pandemic environment, while some of the funds that asset allocators are invested with are finding ways to profit, many funds are performing poorly. Some will close as a result. Across the board, we see allocators needing to redeem and reallocate as turbulent market conditions persist. 

Covid-19 and a crash in the oil markets have triggered a bear market that may lead to a recession. While the complexion of this bear market is different from 2008-9, there are applicable lessons from the last recession that can be helpful to Allocators in 2020.

Year after year, Agecroft does an excellent job bringing together a mix of funds, allocators, and service providers for their hedge fund allocator conference. Here are the top takeaways from Agecroft's "Gaining the Edge" in 2019:

Vidrio is a Technology Enabled Service for fund allocators. We collect a full range of data from external managers for our clients so they can focus on more value-added tasks. We use all this data to power a range of functions that let fund allocators live on one screen to perform research, portfolio management, and operational tasks. We offer unrivaled depth in data servicing and cutting-edge technology for managers of managers.