Coping with data proliferation

Big data – it’s here. The explosion of data is transforming the way we do business, and coping with the increasing amount is a challenge that can become an opportunity for investment managers.

It’s a consequence of the digital age we live in – a huge amount of data is now part of our lives, no matter what our business is or how we use that data. Hal Varian, Google’s Chief Economist said it best:

“Between the dawn of civilization and 2003, we only created five exabytes; now we’re creating that amount every two days. By 2020, that figure is predicted to sit at 53 zettabytes (53 trillion gigabytes) — an increase of 50 times.”

That’s pretty much now. The explosion of data (and the fact that businesses are holding on to more data than ever before) has meant that information that actually helps decision makers is being obscured. Not only that, but it puts storage space at a premium.

The more data a business has, the more complex it becomes. Not only does it pose an increasing technology challenge, but it impacts significantly on investment management.

Data is essential for investment managers, because it:

  • Informs all levels of decision-making
  • Is required to justify investment decisions
  • Is critical for every team in the business – front, middle and back office

Today’s current data proliferation is means that data is becoming more difficult to digest and interpret. There’s so much data, but it’s still required for analysis and insight. The more data there is, the more technology will be required to assist with that analysis. Investment decisions rely on high quality data, so coping with this volume efficiently is essential.

This is partly down to investment managers improving their understanding of the types of data they need to analyse. Reducing the complexity is about gaining control and being proactive about the fact that data will continue to proliferate. It needs to be harnessed, to transforms the challenge of data proliferation into opportunity.

This opportunity is based around the fact that the more data there is available, the more actionable insights investments managers can follow. All this data has potential, the trick is harnessing it and then using it to gain investment advantages.

In the investment management industry, there’s more demand for data, especially what’s known as ‘fine grain’ data. This is essentially more highly detailed data, and it comes from a wide range of sources. In any investment portfolio, the complex assets typically have many layers of underlying detail. There’s also many level of data in alternatives such as who are the directors of the companies and who are the related parties through to sub-lease holders in real estate portfolio holdings. The finer the grain the more complete the investment manager’s picture.

What this means is that while there’s more data in the investment management industry, there’s also an increased demand for that ‘next layer’ – the fine grain data that provides greater insight into investment option details. It’s also located in different places, and with the increased proliferation, there can be issues bringing it all together. That’s where it’s essential to have the right data management capability and technology to manage the data to ensure its reliability and integrity.

This is at the heart of what we do at AlphaCert – we put you in control. Our enterprise data management software is a single source of trusted data, that:

  • Provides reliable, automated data processing
  • Straight-forward reports and improved efficiency
  • Fast verification, improved knowledge and high quality data integrity

It’s a solution that allows investment managers to make assessments in real-time as well as periodically. This is a way of coping with the influx of fresh data, because they’re more regularly informed and their analysis highly detailed. And that leads to being able to pinpoint investment opportunities more frequently.

If you’re keen to learn more about how AlphaCert puts you in control when it comes to coping with data proliferation, get in touch.

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