Alternative Asset Servicing
Achieving operational excellence is paramount for success when managing the manual nature of alternative investments. Optimizing the processes across the investment lifecycle is a foundational stride towards operational agility. It is crucial to control your operating costs, reduce operational risk, and achieve heightened efficiency across your alternative asset classes.
Whether you’re an OCIO, asset owner, or traditional asset manager running an alternative funds of funds, our Olmstead team is uniquely positioned to facilitate this journey by identifying optimal utilization of streamlined processes, cutting-edge technology, and outsourcing solutions to elevate service delivery and support your investment strategy.
Private Equity Funds
Private Debt Funds
Hedge Funds
Fund of Funds
Liquidity Management
Nimbly managing liquidity in an alternatives portfolio is crucial to meet capital calls, expenses, and other cash obligations, track redemption windows, and seize new investment opportunities. Proper liquidity management safeguards against cash shortages, supports investment strategies, and enhances overall fund efficiency.
Leveraging the right tools, whether internally or via a service provider, to track liquidity terms and supply to your order management system is critical to your portfolio management process.
Treasury Agility
From subscriptions and redemptions to capital calls and distributions, you’re likely managing vast numbers of wires across your alternatives book. This process not only bogs down resources, but carries significant operational risk due to its very manual nature.
The treasury process is often an ideal candidate to assess for outsourcing, to get your shop out of the business of wire processing and focused toward value-add activities.
Trade Management
In contrast to the high level of automation in the world of traditional investments, trade support for alternative assets is onerous. The process to fill out subscription and commitment documentation often requires dozens of data inputs. On top of that, maintaining current KYC/AML information is a logistical burden if your firm manages alternative investment portfolios for a large number of clients.
Trade management of alternatives is another process ripe for outsourcing. Many service providers have developed tools that automatically populate trade documents and ensure that the trade execution process through settlement is successfully and efficiently completed.
Valuation
Managing the incoming valuations of alternative assets, which often arrive via an emailed PDF or require download from a website, is cumbersome and time-consuming.
For your structured products, your fund administrator should be doing this work, and leveraging automation to collect and load valuation data timely and accurately. But if you are an OCIO, advisor, or other asset allocator struggling to manage this process across your clients’ own administrators, you might explore using a middle office service provider to allow you to scale this process.
Fund Look-Through
Managing asset class allocations, ESG guardrails, country, company, & issuer restrictions, and other investment requirements will necessitate that your investment teams have a clear view into the funds within their portfolios.
Fortunately, there are vendors which can aggregate and supply the underlying investment data of alternative funds, but wrangling that data is a whole challenge of its own. Your data architecture must empower your investment teams to get the most out of your data.