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AdminFeb, 28 20235 min read

Investment Firms Seek Reliability and Security as they Use Technology to Do More with Less

The past year was a challenging one for many investment firms.

In the US, as the Fed increased interest rates, the market's record highs of 2021 dropped dramatically. In this down market, many firms were forced to balance their desire to expand and grow their businesses with the need to do more with fewer resources.

Firms were looking to find value and gain basis points where they could, and many took on new strategies to do so. At the same time, evolving regulations and staying in compliance presented a challenge for both new and existing instruments. Firms also faced added pressure on security, as cyber threats continued to drive the need for protection and resilience.

Many firms found that vendor reliability had the power to assuage these challenges or to add to them. In short, vendor reliability could make or break an investment firm’s success. Firms facing regular outages and downtimes and sub-par service realized this and took steps toward finding a better solution.

In times like these, asset managers need access to information that keeps them updated on industry challenges, trends, and opportunities so they can make better decisions for their firms.

By leveraging the expertise of industry leaders and thinkers, has become one such resource.

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Here are four of the most significant trends that were of interest to visitors over the last year:

1. Investment Firms Doing More with Less

For many investment firms, rising interest rates and declining markets meant tighter budgets and increased focus on the allocation of resources within the firm. As a result, many firms looked to understand their options as they strived to do more with less. 

Research by Aite-Novarica Group reports that many asset managers are reducing costs by moving away from proprietary software and investments in hardware. Instead, these firms are adopting outsourced technical solutions delivered via the cloud that allow them to save money on hardware and maintenance. 

As firms looked for additional ways to save on technology spending, our post on the new investment ecosystem model was a popular resource. By using plug-and-play API technology to expand functionality, firms can create a much more dynamic investment ecosystem – and make better use of their resources. 

To learn the actual value access to third-party apps and solutions and other aspects of their investment technology offer, readers leveraged the calculation outlined in this blog post. Learning how to measure the actual cost of their technology investment helped readers make better decisions about how they allocate their resources. 

2. The Need for Quality, Dependable Vendor Support   

Research reports that investment firms' quests to do more with less extend beyond technology to the human resources of their businesses, including IT professionals. Now, instead of managing cumbersome proprietary solutions, stitching together disjointed workflows, and spending hours on end troubleshooting, the role of more streamlined IT teams are evolving to include overseeing turnkey, strategic integrations in an outsourced investment technology ecosystem.

While more streamlined, strategic teams make sense from a best-of-breed technology and cost-saving perspective, the need for troubleshooting and support does not just go away. Vendor support should help fill this void.

Unfortunately, some firms have experienced significant challenges with their vendors' levels of support. As a result, many readers wanted to know what level of support they should be able to expect from their technology providers’ service teams. This post helped address that question: Market Changes Put Renewed Focus on Service: Does Your Technology Vendor Measure Up?

For investment firms realizing they were not getting the support they deserved and wanting to learn what it would be like to make the switch to SS&C Eze, we shared this video, giving them a first-hand perspective directly from our clients. 

Making the switch to new technology can feel daunting for many firms, but it doesn’t have to be. This post: Switching Investment Management Systems: Questions to Ask Potential Technology Providers guides investment managers through the questions they can ask to make sure their transition to new technology will be smooth and efficient.

3. Asset Class Expansion & Technical Evolution to Keep Pace in a Shifting Market

As returns on traditional portfolios dwindled, many asset managers looked to asset class diversification to keep pace with the performance of their peers. In doing so, many investment firms found that one of their biggest challenges was the systems on which they operate.

For example, with more institutions investing in crypto, digital assets are beginning to enter the mainstream. With cryptocurrency investment strategies at a tipping point, asset managers wanted to know if their investment platform could handle digital asset operations. In one of our most-read posts, they found the answer: Coming in Hot – Cryptocurrencies Spark Institutional Interest, Drive Technological Innovation.

Exchange-traded funds were another attractive investment alternative for asset managers. The ETF market is growing, but securing opportunities means asset managers must navigate a complex and evolving regulatory landscape. To better understand how technology supports this investment opportunity, readers gravitated to this post: Five Challenges Facing ETFs and How Technology Can Solve Them.  

In the end, expanding asset classes can lead to improved performance. But it can also introduce new labor-intensive processes that increase operational risks and costs. To succeed with these assets, managers need solutions that cater to the unique requirements of each instrument while continuing to look, feel, and offer the same institutional-level performance firms rely on when managing more traditional asset classes.

To fully understand the risks and rewards of a multi-asset strategy, this blog post: 5 Challenges Investment Managers Face in Diversifying Their Asset Class Offerings  from last year remained popular among readers. 

4. Cybersafety and Cybersecurity Continue to be of Concern

Cyberattacks are on the rise. According to research by Statista, in the third quarter of 2022, approximately 15 million data records were exposed worldwide through data breaches, an increase of 37 percent compared to the previous quarter.

Because these attacks can threaten the integrity of a firm’s privacy, readers were eager to find information to help keep their data safe.

In this environment, that means investment management firms must continually evaluate their platforms, policies, and procedures to enhance cyber safety. This whitepaper was a popular download because it guides firms through the steps for doing so.

Readers also gravitated to security tips and insights they could immediately implement, like the ones detailed in this blog post: Cybersecurity Roundup: Top Tips and Insights for Keeping Your Firm Safe and Cybersecure.

Finally, in this time of ongoing threats, ISO certification was a topic that received much attention. Readers wanted to understand what it means to work with a vendor that is ISO certified – and how that certification contributes to data security. 

Stay in the Know!

The coming months are sure to bring new opportunities and new challenges. Keep pace with these developments and more by subscribing to the SS&C Eze blog.

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