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10 May 2018

Hedgeweek: More than half of institutional investors plan to outsource data management by 2021


New research by State Street Corporation reveals that more than half (60 per cent) of institutional investors surveyed plan to partly or fully outsource their data management over the next three years.

“Explosion in data complexity has fundamentally changed the way asset owners and asset managers compete and operate,” says Subbiah Subramanian, global head of State Street Global Exchange’s data-as-a-service offering, DataGX. “Today’s investment climate requires an overwhelming amount of data, and as the lines between front, middle and back office continue to blur, smarter data management is absolutely essential for effective performance and recognising growth opportunities.”

More than half of survey respondents (57 per cent) cite the driver behind this change in data management as demands from regulators. However, it also appears that data [management] is rapidly becoming increasingly important to institutional investors with almost one-third (30 per cent) stating that the incorporation of new information insights or alternative data into their investment process will be one of the strongest opportunities to help increase assets for their firm over the next five years.

“In an environment of increasing regulatory requirements, and with low yields necessitating investors to look into alternative – and often more complex – sources of alpha, it seems clear that institutional investors will continue to prioritise data management and analytics to make better investment decisions, meet regulatory requirements, and gain competitive advantage,” says David Pagliaro, head of State Street Global Exchange, EMEA.

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© Hedgeweek


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