Even as interest rates trend upward and traditional fixed income investment vehicles reclaim some of their luster, insurers and other investors continue to show interest in private market investing.
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Every day, investment and wealth managers face multiple risks: competitive, market, regulatory, geopolitical, inflationary, credit and so on. They have enough risk on their investing plates without a side of operational risk added to the mix.
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SS&C recently hosted an "Investment Operations Managed Services: Client Perspectives" webinar during which clients discussed the workings and benefits of investment operations managed services. In this post, we share some notable takeaways from the session.
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Many asset managers are revisiting the option to have third-party experts manage some or all of their investment operations through outsourced or co-sourced managed services; the market is expected to grow by 7% annually through 2024.
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As investment management firms explore ways to lower costs and improve their operational efficiency, they continue to focus on opportunities to streamline the whole front-to-back office process. This presents a tremendous opportunity to transform the business so it is positioned to grow and have the agility to meet opportunities for years to come. While few disagree that an end state of having everything on one technology platform would achieve this outcome, the challenge is getting there.
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With all of the day-to-day rigors of running an investment operation, it is difficult to devote the time to look at your overall operations, but it is important to pause and consider areas to improve and your longer-term future needs. In my role as a product manager, I often hear from wealth management firms that are struggling to optimize their operations and feeling they lack a compass to help them chart the path forward. As one firm representative told me, “We just don’t know what we’re looking for.” I’ve seen hundreds of clients and implementations, and in this post, I share my perspective on some of the key aspects you should consider to grow and optimize your business.
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Between falling fixed-income interest rates and the quest for superior returns via alternative investments, insurers are constantly reevaluating their investment strategies. After the operational dislocation arising from COVID-19, they should also be looking at investment operations to make sure they have the resiliency to support their strategies in a more dynamic market. From talking with insurance industry clients and analysts, we’ve identified five fundamental trends that insurers need to be mindful of as they weigh their operational decisions.
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