Portfolio management woes are weighing on Singapore’s wealth and asset managers

Our years of experience in the industry have taught us that success for wealth and asset management institutions ultimately comes down to a few core tenets:

  • improving efficiencies to cut costs
  • better managing risks
  • enhancing transparency
  • providing more accessible and responsive client service
  • freeing-up employees to focus on value-added activities
  • investment performance

In a rapidly evolving and competitive market like Singapore, these factors become all the more important. Yet the results of our recent survey[1] show firms are struggling in a key area: portfolio management.

 

Still beset by manual inefficiencies

High levels of manual intervention are a particular problem. Two-thirds of the executives surveyed estimated over 30% of their institution’s portfolio management work must be completed manually. And with Singapore seeing high (and rising) remuneration levels among its finance professionals, ensuring employees’ precious time is devoted to revenue-generating activities rather than manual portfolio management tasks has to be a priority.

The most manually onerous area is initial portfolio construction, in large part because of tightening regulation and the ever-heavier compliance burden.

It is followed by compiling investment performance reports, monitoring against investment mandates and portfolio rebalancing.

For instance, almost a third of respondents say it takes more than 90 minutes to prepare and check each client’s regular investment performance report. And given Asia’s trading-orientated investment culture, granular reporting capabilities are an especially important part of the client servicing mix.

Manual inefficiencies are becoming more pronounced too with the ongoing shift to diverse asset classes, notably alternatives. Not surprisingly, that leaves firms struggling to optimize investment performance, operational efficiency and risk management, and to deliver the transparency clients and regulators increasingly require.

 

System weaknesses

Much of the problem lies with firms’ outmoded portfolio management systems—and the fact that in many cases they are relying on a multitude of different ones. Indeed, the study found over a third of the wealth and asset management professionals surveyed are dissatisfied with their organization’s systems for constructing, managing and monitoring portfolios. Less than a tenth say they are very happy with their technology.

The goal, ideally, should be a single core portfolio management solution able to centralize and standardize all portfolio management activity and data, built on genuine open architecture to allow ease of integration with other systems and third parties where required. That will enable firms to reduce their technology footprint, drive greater efficiencies, and focus on adding value to clients through the quality of their advice and relationships.

At SS&C Advent, we have developed industry leading tools, designed to support every aspect of your portfolio management business. Our multi-currency and multi-asset class order management, portfolio management and performance measurement tools enable you to trade, account and report on diverse financial instruments. Our automated connections to custodial and market data providers ensure you’re working with the most up to date information. All of this data is also accessible to clients through a sophisticated and interactive portal that enhances their experience and engagement and enables them to stay on top of their portfolios anytime, anywhere.

Over 4300 customers around the world trust SS&C Advent to run their critical wealth management business.

With the right technology, this is an opportunity to differentiate your offering in a dynamic, yet crowded environment.

[1] Portfolio management efficiency: A snapshot of Singapore’s wealth and asset management sector, produced by WealthBriefing in partnership with SS&C Advent

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