More than 40% of buy-side firms believe the data they receive from various systems are not consistent or of high quality, according to a survey conducted by software provider SimCorp.
The survey polled nearly 100 executives from 50 buy-side firms in North America. The survey also found that 67% of executives believe there are problems reconciling data between disparate systems for order management, accounting, performance and risk.
About 22% of respondents said it would take days (rather than minutes or hours) to generate a report calculating their firms exposure or performance across all holdings, including derivatives. Nearly 8% responded that it would take weeks.
“The statistics are distressing,” says Matt Samelson, principal at Woodbine Associates, the Stamford, Conn.-based consulting firm. “According to these numbers, 40% of those surveyed are making investment decisions based on poor quality data, and nearly 30% do not have a near real-time view into their exposure, making it impossible for these firms to be agile and respond to shifting market dynamics. We as a community need to galvanize change in order to restore investor confidence.
David Kubersky, managing director of SimCorp North America, adds: Improving data quality does not have to be rooted in a long and expensive enterprise data management undertaking. Investment managers that have adopted core multi-asset class investment accounting systems have a distinct advantage with data quality, as position data is already consolidated in a single repository across all instrument classes.
(CG)