Financial Services Ireland


How to achieve agility in alternative investments

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New target operating models for asset managers

Our latest annual Global Alternative Fund Survey found that over one-third of investors are broadening their private equity exposures, with others looking to infrastructure, real estate and other private market offerings.

This move toward alternative asset allocation has accelerated in recent years, as historically low interest rates along with growing market uncertainty have forced institutional investors to look farther and harder in their search for returns.

Our latest thought leadership, which you can download via the link below, discusses how the influx of institutional assets has not only boosted competition within the alternatives space, but has also led multi-asset managers to reassess how to achieve efficiency and scale as they expand into alternative investment strategies.

As the traditional and the alternative investment spaces are increasingly converging to meet investor demand, asset managers are finding that the nature of illiquid alternative assets is ill-suited to traditional fund management processes and systems. Key challenges include:

  • Functional and governance considerations
  • Data and valuations
  • Organisation and people

To succeed in the alternatives segment, asset managers must maintain an operating model that can function seamlessly within these relatively illiquid markets.

Traditional asset managers are expanding their product range to include private market investment opportunities to their clients, including private equity or debt, real estate, infrastructure, alternative credit, and more. But do current operating models have what it takes to efficiently and profitably expand one’s alternatives’ footprint? The capabilities needed to operate these types of strategies are fundamentally different, requiring asset managers to pause and consider how best to tap into this market.

With some managers seeking a one-stop shop for all their outsourcing needs, traditional asset servicers have responded by diversifying their core capabilities, offering an even wider range asset-class coverage. Others, perhaps driven by investors’ seemingly insatiable appetite for better data and analytics, prefer to partner with independent providers offering specialised technologies and services on an outsourced basis. Whichever route a manager may take, the key is to ensure that across the asset classes, funds become smarter, more efficient managers of risk and returns.” – Paul Traynor, Advisory Lead, Wealth & Asset Management

We can advise fund management firms as they weigh the benefits of adopting new systems, tools and processes, as well as help assess prospective alternative opportunities prior to committing investment capital. If you have a question, don’t hesitate to get in touch.

Paul Traynor

FS Partner, Wealth & Asset Management Consulting Lead
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