Product Type: Market Research Report
Published by: TowerGroup
Published: January 2006
Product Code: R301-803Description Hedge fund managers worldwide have shown a growing interest in disassociating themselves from many of the operational aspects of their business. An estimated 90% of hedge fund managers are already outsourcing their back-office fund administration, accounting, and shareholder servicing to a fund administrator. However, the middle-office functions (loosely defined as post trade but presettlement) have traditionally remained in-house. This practice is changing as fund managers deal with the complexities of reconciling higher volumes of more complex trades and the strain that this puts on staff and IT. At the same time, service providers have improved their capabilities in many of the middle-office functions and now offer a compelling choice for their hedge fund clients. Both fund administrators and prime brokers have their eyes on this market, setting the stage for what may be the next battle in buy-side outsourcing. This TowerGroup Research Note analyzes the growing demand for outsourced middle-office capabilities.Table of Contents - TowerGroup Take-Aways
- Report Coverage
- Vision
- Exhibit 1: Global Adoption of Middle-Office and Back-Office Outsourcing (1990-2010)
- Background
- Exhibit 2: Services and Functions of the Front, Middle, and Back Offices (2006)
- What's Motivating the Interest in Middle-Office Outsourcing?
- Revenue Pressure
- Focus on Core Competency
- Trading Volumes
- Derivatives Processing Challenges
- Product Expansion
- Challenges Facing Service Providers
- A Broken Record? Derivatives Processing Challenges
- Rising Importance of Value-Added Services
- Exhibit 3: Outsourcing Revenue Shift from Core Services to Value Added Services (2004-09P)
- Revenue Opportunity in the Hedge Fund Middle Office
- Exhibit 4: Revenue Opportunity in Hedge Fund Middle-Office Outsourcing (2005E-08P)
- The Players
- Exhibit 5: Service Providers Converging on the Hedge Fund Middle Office (2006)
- Technology Vendors
- Exhibit 6: Key Technology Vendors to the Hedge Fund Middle Office (2006)
- Summary
|
|
