Syncova announces that as recent market events have driven hedge funds to move to multi Prime Broker relationships, Optima/Fund is increasingly being chosen as the best tool to manage margin and financing.
Key Market Drivers
–
Prime Broker vulnerability-
Liquidity protection and ensuring operational stability-
Imperative to move to multi Prime Broker relationships
–
Need to manage margin and financing costs across multiple counterparties
The liquidity issues and vulnerability of some Prime Brokers during the financial crisis of this summer has highlighted the need for hedge funds to use more counterparties and have better controls over efficient use of the relationships. When adding Prime Brokers, hedge funds need to accurately manage the margin and financing costs, and test scenarios that could cause margin calls. As the only vendor system dedicated to this function, Syncova are pleased to be winning new clients for their Optima/Fund platform.
Syncova has recently won two more mandates from top rated hedge funds totalling over $40 billion in AUM. These funds are using Optima/Fund to predict margin requirements at their counterparties and provide a detailed and automated daily reconciliation. The What-If features were also important in the purchasing decision as this provides the ability to analyse scenarios that could produce margin calls such as Prime Brokers increasing margin rates.
Optima/Fund was developed to meet a recognised need in the market not catered for by any other vendor, says Liam Huxley, CEO of Syncova. The market stresses through the summer of 2008 have highlighted that the single prime broker model is no longer reliable and that hedge funds need to use multiple counterparties. This creates issues in how to ensure that these relationships are used effectively and that the Fund Managers can quickly and easily analyse cash and liquidity. Our Optima/Fund solution is designed precisely for these needs and this is being recognised by major funds as the market profile changes.
D.C.