SS&C lays out common fund manager mistakes

SS&C highlights the key mistakes often made by managers when selecting a fund administrator to service their fund.
By Paul Walsh
Choosing a technology-constrained fund administrator, failing to vet the administrator’s service team and selecting an administrator with limited data access are among the key mistakes made by fund managers when selecting a fund administrator, according to SS&C.

A whitepaper published by SS&C Technologies revealed the most common mistakes made by fund managers when selecting an administrator for long-term fund growth.

According to the report, selecting an administrator with a constrained technology approach can be a hindrance when servicing new markets, asset classes and regulations.

A lack of due diligence is also cited as a common mistake, with the whitepaper claiming fund managers often select an administrator based on the impression of the administrator’s sales team without assessing the full credentials of the team servicing their account.

Limited data access is also regarded as a common mistake to be avoided with the report stressing the need for data to be readily available to managers in flexible formats.

The research follows a great deal of industry commentary on the fund administration space with particular focus on how smaller administrators can compete with their larger counterparts.

Fund administrator Heritage told Global Custodian earlier this year that offering a flexible and diverse service is key for smaller administrators to keep their place in the market.

Mariana Enevoldsen, director of Heritage, explained that services offered by larger fund administrators may not be necessary or suitable while Heritage’s head of operations in the UK and Ireland Gerry Warwick suggested a possible clash between large funds and large fund administrators as they may both have complex protocols.

In addition, a string of acquisitions within the fund administration industry has shown how the sector is continuing to consolidate.

Last week SS&C Technologies completed the acquisition of Wells Fargo’s Global Fund Services (GFS) business administering over $42 billion in alternative assets.

SS&C also completed the takeover of Citi’s fund administration business earlier this year, while firms including BNY Mellon, MUFG, and smaller shops such as Custom House, have also been expanding through acquisitions.