Increase in market volatility and other risk factors such as inflation concerns require the ability to analyze client portfolios for ‘factor’ shocks, i.e. FX, spreads, inflation, index changes, etc.
Having this capability to analyze portfolios using hypothetical scenarios in ‘real-time’ will be a key competitive differentiator for buy-side firms managing multi-asset portfolios.
Results of such forward-looking analysis in a ‘Business Intelligence’ dashboard along with Performance(ex-post) and accounting data is a must not only for pro-active portfolio management but also for communication of the same to investors.
Key challenges to execution include integration with legacy and third party systems and the need for a robust data model.
For successful execution, it is necessary to have a team with the right mix of ‘experienced’ domain and technology background, i.e. folks who have been there and done that.
