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Examining the Role of Research Management & Portfolio Management Systems in 2017

By Jaime Bean, Ledgex Systems | Tuesday, May 9th, 2017

Regulatory expectations and financial markets continue to evolve. Ensuing from these shifting landscapes are heightened pressures on the shoulders of investment firms to deliver greater transparency, manage complex relationships, improve the overall due diligence process and utilize mass data in a more interactive and intelligent way.

In this article, let's explore some common questions around how Research Management Software (RMS) and Portfolio Management Systems (PM) work together.

What are the key benefits of utilizing a Portfolio Management (PM) solution?

It likely goes without saying, but portfolio management systems are core to the investment operations of an investment firm. In the age when transparency is the rule, these systems allow managers to fully understand and manage portfolios and share that transparency with investors or other interested parties. The features of these systems continue to evolve.

For example, a Portfolio Management solution that incorporates models (i.e. Yale model) for cash forecasting enables users to easily forecast future asset values and cash flows of illiquid alternative assets, such as private equity investments. This forward planning capability enables planning for future cash requirements and enables firms to avoid a crisis of liquidity. 

What are the key benefits of utilizing a Research Management Software (RMS)?

There are four core benefits of using a RMS:

  1. Gaining a central data repository: Housing a firm’s data within a user-friendly, central repository simplifies processes, optimizes productivity and uncovers new business opportunities;

  2. Meeting regulator’s expectations, enabling managers to easily search the repository and export queried data with just a few clicks of a mouse;

  3. Fostering stronger relationships, by diving deep into the complex layers of contact relationships, enabling professionals to monitor interactions & transactions, track communications and identify accounts that deserve further attention; and

  4. Effective and accurate reporting, delivered through customized reports that offer real-time insights into a firm’s operations, improving analysis of interactions, portfolios, relationships and pipeline activities.

How do PM and RMS work together?

The advantages of selecting a system that combines portfolio management and research management capabilities are significant. Combined systems offer a comprehensive centralized data warehouse that gives users the ability to see qualitative and quantitative information holistically.

By centralizing data in one system, firms increase data quality and follow industry best practices for having one system to validate and maintain up-to-date/correct data. With a combined system, due diligence efforts are simplified and all details from manager performance updates to last meeting are centralized.

What are the most common motivators for adopting these solutions?

There are a number of factors driving the adoption of these combined systems. Progressive firms understand the importance of standardizing investment and business processes. Beyond maintaining standards, firms must be able to clearly demonstrate the effectiveness of these processes to outside individuals/organizations that may wish to audit the firm.

Another motivator is the recognition that data is a powerful tool and offers a serious competitive advantage to firms that can effectively organize and utilize it. These systems surround a centralized data warehouse and repository with powerful features that enable firms to effectively manage complex portfolios while identifying future opportunities in one unified system.

What are top considerations when evaluating PM and RMS solutions?

When it comes to portfolio management and research management solutions, one-size does not fit all. Managers must select a platform that is tailored for their industry and investment approach. Flexibility and configurability are also important consideration factors. You want a system with models and fields that align to your data but also the ability to be molded to your investment and operation processes.

Finally, since portfolio management is a core function of any asset allocator, you want a system with a strong portfolio management feature set that is complimented by research management features that let you efficiently manage and navigate mass amounts of research data in a centralized data warehouse.

For more information on RMS and PM systems, read Ledgex's full whitepaper here.

Fund of fund accounting software

Jaime Bean is Managing Director at Ledgex. Ledgex Systems is transforming the way fund of funds, private equity funds, endowments and foundations, consultants, pensions and family offices manage their portfolios, make investment decisions and meet investor demands. The powerful Ledgex platform is an integrated technology suite that streamlines front and middle office functions of investment management firms. For more information on Ledgex, visit our website at or call +1(877)-700-1921.

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