The financial crisis of 2008 has upset the relatively stable equilibrium previously maintained between hedge fund managers and their traditional service providers, according to a white paper released by Nirvana Solutions, provider of Nirvana (TM), a real-time portfolio management system for multi-prime hedge funds, prime brokers, and fund administrators.
The white paper, entitled “The New Model of Prime Brokerage – The Multi-Prime Service Platform,” documents the dynamic changes to the hedge fund industry and its service providers in the aftermath of the 2008 market crash. Peter Curley, managing partner at Nirvana Solutions, examines how the roles of traditional service providers have changed, leading to the emergence of a new service model providing the full range of hedge fund services through a single, real-time multi-prime infrastructure built on a common, outsourced technology platform.
“The profound impact the crisis has had on hedge funds has already been well-documented,” says Curley. “Another significant outcome of the crisis, we feel, will be the aggregation and convergence of services provided to hedge funds through a single service provider. This new service provider cannot be adequately described as a mini-prime or a fund administrator but rather a hybrid of both, a model we are calling The Multi-Prime Service Platform.”
New requirements, such as multi-prime technology that can provide real-time views of critical data such as exposures and risk, and impending hedge fund regulation, are now converging to significantly increase the barriers to entry for new hedge fund managers.
The operational efficiencies achieved through The Multi-Prime Service Platform promises to provide the critical sub-USD500 million segment of the hedge fund industry-where the tension between the new requirements and the hedge funds’ ability to pay is at its most intense-a cost effective, fully integrated solution providing real-time transparency in a multi-prime environment.
To download the white paper please visit: www.nirvanasolutions.com.
L.D.