Insights
A collection of buy-side thought leadership articles
Insights
A collection of buy-side thought leadership articles
Supporting ESG Investing for APAC Asset Owners
By Peter Sherriff , Director, Product Strategy, Asia Pacific Charles River Development Across the Asia-Pacific (APAC) region, asset owners in both developed and emerging markets are keen to adopt Environmental, Sustainable and Governance (ESG) investment practices....
Traders with Machines: Why Trade Automation is Cooperative Game Theory and not a Zero-Sum Game
by Kyle Pedrotty and Jay Hinton. One of the hottest topics for institutional traders in 2020 has been the impact of automation on trading workflows. Charles River has been actively working in this area as well, and we recently launched a new product development team...
Helping APAC Asset Owners Navigate Regulatory Change
In our second Insight discussing the challenges and opportunities facing APAC asset owners, we examine regulatory headwinds and their impact on asset owner operating models and growing reporting obligations. By Peter Sherriff , Director, Product Strategy, Asia...
Helping APAC Asset Owners Address Liquidity Challenges
In part one of this series exploring the challenges and opportunities facing APAC asset owners, we discuss recent pandemic-driven liquidity issues and the tools that organizations are using to measure and manage this form of risk. By Peter Sherriff , Director, Product...
Maintaining Business as Usual in the Most Unusual of Times
by Spiros Giannaros President, Charles River Development In the months since mass quarantines swept the globe, the topic of resilience has surfaced repeatedly in my daily conversations with customers. Portfolio management and trading has traditionally been a...
UX Insights Article: The Grid is Dead. Long Live the Grid.
by Jay Hinton and Sean Jacobs Look at any marketing material for a trading application, and you’ll quickly come to the conclusion that the trading applications of the future will have no grids—it will be all graphs, blinking lights and price tiles. At the same time,...
Delivering a High Quality User Experience to the Front Office: The Importance of Themes, and Why the Dark Matters
by Jay Hinton and Sean Jacobs Summary: While user interface (UI) color choices may seem arbitrary or tied to individual preferences, an emerging trend seems to reveal that color does matter for a number of cognitive and physiological reasons. The end result is an...
How Asset Manager M&A Impacts FX Trading Technology Choices, Part 2
In Part 1 of this two-part series, we discussed some of the challenges around order generation in FX management that confront asset managers undergoing a merger or acquisition. Specifically, we looked at issues that arise when firms seek to combine and rationalize...
How Asset Manager M&A Impacts FX Trading Technology Choices, Part 1
Mergers and acquisitions between asset management firms are at a historical high, driven by margin compression, the ascendance of passive management, and growing regulatory compliance costs. A thorny FX management challenge facing asset management firms is the need to...
The Future of Fixed Income is Adaptive
In our previous Insight covering the key themes at the 2019 Fixed Income Leaders Summit (FILS), we highlighted how electronic trading has grown in sophistication, and how trade automation is now a requirement for asset managers needing to construct, de-risk or...
Moving from Electronification to Automation in Fixed Income Markets
Charles River Development has been an active participant in the annual Fixed Income Leaders Summit (FILS) since the inaugural event in 2014. The caliber of presentations, panel discussions, and networking opportunities ranks FILS as a key event for investment...
Liquidity, Execution and Collaboration: Old Problems, New Solutions
Now in its fourth year, the 2018 Fixed Income Leaders Summit (FILS) drew record attendance from buy-side firms, trading venues and technology vendors. Charles River has participated in this event since the start, and we’ve worked with our buy-side clients and...
The New OTC Challenge: Optimizing Collateral Management in the Front and Middle Office
Collateralized OTC derivatives transactions help firms reduce credit risk when dealing with smaller, less capitalized counterparties, during periods of market shocks, and when holding long-dated positions. However, managing, monitoring and optimizing collateral places...
Creating Efficiencies and Reducing Operational Risk with an Investment Book of Record (IBOR)
An increasingly critical middle office function is delivering accurate and timely position data to the front office and ensuring redundancy with outsourced back-office services. This article discusses the operational, regulatory and competitive drivers for automated...
Rethinking the Middle Office: Solving Buy-side Challenges with Financial Technology
The buy-side middle office is undergoing significant change, as new regulations, increased use of OTC derivatives and fee compression force firms to reevaluate their existing staffing, workflows and technology. This Insight explores those changes, and discusses how a...
Designing Smart Beta Portfolios (PART 2): The Role of Factor Models and Technology Considerations
Charles River recently discussed how Smart Beta products can improve portfolio diversification, minimise undesirable correlation risk, and deliver better risk-adjusted performance. This article continues the discussion, focusing on the pivotal role of factor models in...
Designing Smart Beta Portfolios (PART 1): Challenges and Considerations
Increasingly popular Smart Beta products provide investment managers and asset owners with conveniently packaged exposure to a number of factors. Risk factors are granular attributes of one or more asset classes that explain risk and return. Read Part 2 - Designing...
MiFID II Transaction Reporting Challenges for the Buy-Side
We discuss the key role that technology plays in helping buy-side firms achieve compliance with the regulation’s extensive trade and transaction reporting requirements. Technology solutions must integrate dozens of reporting fields from disparate OMS/EMS, legal...
How Fund Look-through Improves Buy-side Risk Monitoring & Performance Evaluation
Asset managers and owners increasingly implement their investment strategy by buying funds from a number of providers. These funds can represent a significant portion of the firm’s portfolio, and complicate their ability to manage risk, measure performance and comply...
Two Approaches to Buy-Side Scenario Analysis
Buy-side firms increasingly offer a diverse set of funds and products to meet the risk appetites and investment objectives of their institutional clients. Multi-asset, long-only, and leveraged portfolios all have very different characteristics that require front and...
Understanding Mortgage Prepayment Models
U.S. agency residential mortgage-backed securities (RMBS) are the largest and most liquid securitized asset class in the world. Pooling thousands of individual mortgages into a standardized security lets investors easily gain exposure to this important asset...
A Buy-Side Framework for Managing OTC Derivatives
Learn how several regulatory and structural drivers are affecting buy-side usage of OTC derivatives, leading to higher trading costs and a fundamental reshaping of technology infrastructure for managing derivatives. Charles River Development discusses...
Minimizing Performance Dispersion between Models and SMAs
A recent FundFire article found that “performance of portfolios in models-based managed account programs can sometimes diverge from the separately managed account (SMA) strategies they aim to track. Some performance differences can be expected, due to the timing of...
Scaling SMAs to Improve Investment Performance
Separately Managed Accounts (SMAs) are a widely used investment vehicle for endowments, retirement plans, foundations, and wealth managers. The popularity of SMAs is underscored by broad global institutional sponsorship and investor acceptance. As of 2015, more than...
Turning the DoL Fiduciary Rule into Opportunities for Wealth Managers
The Department of Labor (DoL) Fiduciary Rule requires financial advisors to meet a fiduciary, rather than a suitability, standard when recommending investment products for their clients’ retirement accounts. This will significantly impact asset managers, wirehouses,...
TABB Forum Fixed Income 2017 – Liquidity, Price Transparency and Regulations
Charles River discusses The Future of Fixed Income Market Structure and Trading Analytics with TABB Forum. Topics include MiFID regulatory reporting obligations, execution analysis and efficiently sourcing liquidity from the growing number of fixed income trading...
How an OEMS Helps Buy-Side Firms Achieve Best Execution
Learn how an Order and Execution Management System (OEMS) can help traders better serve the needs of their fixed income clients by providing extensive execution analysis capabilities and ensure compliance with emerging regulatory requirements.
Building Smarter Portfolios with Factor Models
In a recent Insights article, we discussed how factor models are changing the way institutional investment managers analyze and measure portfolio risk. In this Insight, we’ll examine factor-based investment methods and challenges, and discuss how managers use Charles...
Enhancing Portfolio Construction with Factor Models
Factor models and factor-based investing are changing the way institutional investment managers construct portfolios and analyze risk. This Insight discusses how factor models enable better portfolio risk assessments and how they are implemented in Charles River’s...
Maximizing the Value of Multi-Leg Orders with an OEMS
As multi-leg strategies garner increased attention from institutional asset managers, the ability to manage these orders in an efficient manner grows in importance. This Insight discusses how a multi-asset Order and Execution Management System delivers...
Simplifying Buy-Side Operations with SaaS
Tom Driscoll, Global Managing Director, on the benefits of combining software, data, infrastructure, FIX Network and other services with Charles River’s SaaS-based deployment. Visit our SaaS Overview page and read the press release on Charles River's Global ISO...
Re-thinking Buy-Side Portfolio Decision Support
Portfolio decision support solutions provide integrated multi-asset risk management and scenario analysis, performance measurement and attribution, and portfolio analysis and construction capabilities on a single platform, with managed security and benchmark data,...
IBOR: Improving Buy-Side Decision Support with Position-Level Transparency
Ensuring that firms are utilising consistent and high quality position data is essential to improving decision support, lowering operational risks and dealing with growing product complexity. Learn More About This Topic The Middle Office Solution Investment...
An EDM Reality Check for the Buy-Side
Enterprise Data Management underpins a firm’s ability to offer differentiated products, centralise firm-wide data, manage complex fixed income and derivative instruments, and maintain real-time visibility into risk factors and counterparty exposures. ...
How an OEMS Bridges the Gap Between Traditional and Electronic Fixed Income Market Structure
An OEMS helps buy-side firms by centralizing connectivity to dealers and trading systems on a single desktop and providing critical trade decision support via a comprehensive database of trade, order and market history. < Order and Execution...
Valuing Interest Rate Swaps: The Importance of Dual Curve Stripping
An Interest Rate Swap (IRS) is a versatile and widely used derivative that helps firms manage interest rate exposures, reduce borrowing costs, and restructure cash flows in a cost-effective manner. A vanilla IRS allows two parties, each with an identical notional...
Improving Operations – Migrating to SaaS, Steps to Success
Software as a Service (SaaS) is seeing increased uptake from Buy-Side firms including Charles River clients seeking to improve operations and provide better support to the front and middle office. With the ongoing evolution and complexity of investment management...
Two Approaches to Stress Testing
Stress tests are risk management tools widely used by both institutional investment managers and regulatory authorities. While annual Dodd-Frank Act stress tests of large financial institutions garner lots of media coverage, the same tools are applied by portfolio...
Buy-Side Data: Getting it Right
Data management and provisioning are two of the biggest challenges facing buy-side firms. Front and middle office operations require significant amounts of pricing and security reference data from a number of disparate sources. The individual vendors of those data...
An Execution Analysis Framework
Regulators and institutional investors are demanding that buy-side firms demonstrate “best execution” for fixed income instruments. But defining the term in a fixed income context is rather subjective. While regulators are working on a detailed definition that...
Easing the e-Trading Transition
The massive changes in fixed income markets since 2008 have been widely discussed; see these Institutional Investor and BIS articles for an in-depth analysis. Shrinking liquidity and limited price transparency pose significant problems for credit desks, leaving...