Are You In Control of Your Market Data Costs?

Effectively managing market data costs is not always an investment manager’s first priority. Here within we examine the contributing factors, and the opportunities for material cost savings.

by Mick Cartwright, CIPM


How often have you heard an investment manager say, “We don’t use that benchmark anymore.”? Probably more often than you’ve heard, “This benchmark is no longer being used and we have properly retired it. By doing so, we no longer need to pay for this data or go through the daily exercise of consuming, calculating and auditing it.”

Market data costs absorb a material portion of an investment manager’s budget allocation and benchmarks represent an important piece of that allocation. It is not as simple as taking the index such as S&P 500, the Russell 3000 or the Bloomberg Barclays Global Aggregate. In many cases, the manager is also consuming the underlying constituent data or index breakdowns of these indices, whether it be by GICS sector for an equity index, by country for an international index, by credit quality, sector or maturity for a bond index.

Getting the index is just the start of the process. As the manager sets up an appropriate benchmark to measure the investment portfolio against, they are likely creating blends of these indices, or calculated variants – index plus 60 bps to serve as our benchmarks. Firms may be paying a service provider to do this for us or setting it up in internal systems. No matter how firms provision the information, there is a tangible cost associated with set up, monitoring and maintenance.

Frankly, the benchmark side of the equation is probably the most straightforward. What about the actual underlying investments? Although firms can easily pay for instrument level benchmark information, how well does this information align with the investments in the…

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Is Your Organization’s Performance at Risk from Excel Anarchy?

Spreadsheets are one of the most powerful tools used by companies today, yet one of the most dangerous in common use across organizations. This paper details the risks and ways to mitigate them.

by Mick Cartwright, CIPM,​ Managing Director


There is no question spreadsheets are one of the most powerful tools used by companies today. There is a relatively low learning curve, the software is inexpensive and readily available, they are quick to get up and running and are easy to modify. These are all reasons why spreadsheets are one of the most dangerous tools in common use across organizations. There are many examples of substantive mistakes due to spreadsheet errors. Who can forget Fannie Mae’s $1.13 billion mea culpa during 2003? In a news release they noted that a review of third-quarter figures revealed a $1.13 billion error in shareholder equity, “…as there were honest mistakes made in a spreadsheet used in the implementation of a new accounting standard.”

If spreadsheets are so powerful, then why should companies be leery of using them? First and foremost, as noted above, they are prone to errors. There are many who are proficient in Excel, yet all have made errors at some point while using spreadsheets. When spreadsheet authors have graduated to using tables rather than copying formulas, leveraging named ranges for clarity, and making data dance with fancy pivot tables and more; spreadsheets remain subject to human error. Even when spreadsheets are in fact error-free and testing validates desired results, there is still the risk that others who use the spreadsheets will introduce errors. Further, the notion that the ease of use of spreadsheets is a strength yields a false sense of security. Other users can copy and modify a file, redistribute it, use the old version of a file,…

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Beyond Enterprise Data Management into the Challenges of Alternatives Data Management

If you think the journey to mastering your enterprise data management (EDM) is difficult, consider the teams wrestling with alternatives data management (ADM). Increasing correlation between traditional investments (equities and fixed income) and the pursuit of Alpha has fueled the expansion into alternative investments. Beyond allocations to external managers and hedge fund managers, this segment extends to private equity, private credit, real estate, real assets, infrastructure and more. Each brings its own complexity. When you layer in fund of funds, primary and secondary investments; the customary drill through for traditional investments is just not possible.

Although alternative investment teams use dedicated tools including IHS Markit’s iLevel, Burgiss’ Private I, Solovis and others; they still rely in some way on Excel and significant manual effort to wrangle their alternatives data. ADM challenges are not just internal to the team working to meet their own analytic and reporting needs, but external as well. In an analytics-led and data-driven world, firms want to see the whole picture to understand how the full range of investments roll up. CIOs and many others need to examine exposure, risk and performance from a holistic viewpoint, rather than from individual asset class silos. This paper explores the challenges of blending EDM and ADM to drive this complete viewpoint.

by Mick Cartwright, CIPM, Managing Director
and Christine (Tina) M. Madel, CFA, Principal

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How Investment Management Firms Benefit from Engaging the Right Consultant

During an era when critical skills are in short-supply and valuable IT and business personnel spend most of their working hours in meetings, consultants can make the meaningful difference between a project’s success or failure. The right consultant brings diverse skills, broad perspectives and an understanding of both business and technology. In addition, consultants are best positioned to contribute in a way seldom possible by others since they can apply focus and attention to the task at hand – something that is difficult for full time employees to do when they are juggling competing demands and BAU tasks. This article:
• delves into business problems prevalent in many investment management firms, especially in vendor product evaluations and implementations;
• deals with how an outside consultant can play a significant, contributory role; and
• leverages a practical use case to demonstrate key benefits and tangible results delivered by a Meradia consultant who moved an almost failing project to a successful outcome.

by Jose R. Michaelraj, CIPM, Senior Consultant

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Wealth Management Study: A Survey Prompted by the Radically Evolving Operating Environment

Meradia’s 2020 wealth management survey collates information from interviews with key executives in the industry. The participating firms range from small- to mid-size and specialize in wealth management and trust service and operations. The study surfaces how firms view market trends and potential future challenges and involves deep discussions about their internal operating models.

The final output is designed to give insight to the industry in the form of commentary rather than statistics, gauge how the market is feeling as well as how firms are managing their clients and businesses. The views are based on observations made by the executives who participated.

by Joshua B. Levitt, Principal

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