As asset owners seek greater returns, they are moving asset management in-house and adopting multi-asset portfolios, thus increasing the importance of data and technology, a State Street survey finds.
State Street commissioned the Economist Intelligence Unit to survey 206 asset owners around the world and found that 89% view data and analytics as at least a mid-level strategic priority, with 52% saying it ranks near the top. 83% said they have increased investment in this area over the last three years.
The survey also found that asset owners are looking to invest more in technology to meet these demands. 85% said that regulation will drive major technology investments, and 60% expect to significantly increase their investment in order management systems and/or execution management systems over the next three years. Another 27% are planning a slight investment increase for these systems.
Asset owners are also looking to increase investment in portfolio modeling/optimization systems—36% are planning a significant investment increase over the next three years, and 38% are planning a slight increase—which is a result of the increasing exposure to new asset classes and bringing more asset management in-house. However, the survey found that only 13% of asset owners think they have the talent necessary to execute their data strategy.
“As they insource more areas of asset management, investors will need to augment their skills and infrastructure in other areas. Even asset owners with well-developed technology platforms will need to embrace specific technologies, resources and expertise to fill gaps in their capabilities. Building a data warehouse to consolidate their data, for example, can be a costly and complex undertaking, and they need to think about the data processes that support this,” State Street says in the survey report.
Asset Owners Increasingly Have More Data Needs, Finds State Street
As asset owners seek greater returns, they are moving asset management in-house and adopting multi-asset portfolios, thus increasing the importance of data and technology, a State Street survey finds.