SimCorp buy-side poll reveals inaccurate portfolio valuations, asset and exposure tracking errors

More than six in 10 buy side professionals believe there are problems with the accuracy of their portfolio valuations because of data errors, according to research published by IT services provider SimCorp.

The results are based on the views of some 50 people from nearly 30 buy side firms across North America. It revealed that 63% of firms experience data reconcilliation errors.

Still more than half, 53%, said that daily tracking of assets and exposurers contain errors.

And a similar number said they had problems with tracking and reporting on assets and exposures.

David Kubersky, managing director at SimCorp North America, said: “If a fund manager has to correct a NAV price due to the wrong portfolio value, it is very damaging to the firm’s reputation.”

“For other buy side organisations, inaccurate portfolio valuations lead to poor investment decisions and deplete investor confidence. At the heart of these failures is a disparate system landscape and fragmented position-keeping.”

Most of the firms surveyed said they have plans to make technology changes in their back office environments, the poll found – but with a caveat.

Some 63% expect investments to improve their situation within two years, but similarly, some 53% said they had not plans for immediate modernisation.

Kubersky said: “Our question to investors is: do you want the 35% who have zero plans to upgrade their infrastructure to manage your investments?”

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