Inside the Matrix: The Future of IBOR

Moving to the Asset Management IBOR Services Matrix
by Jay Wolstenholme, November 13, 2015
Industry Trends
Global

Abstract

Increased industry demands on institutional asset management operations demand an Investment Book of Record (IBOR) architecture. However, just piecing together IBORs is not the solution. Firms need to advance to the IBOR Services Matrix for a complete Service-Oriented Architecture framework.

The competition within institutional asset managers has never been greater, with clients now demanding improved performance, increased portfolio transparency, and auditable operational trading and portfolio processes at a minimum.

Asset managers are broadening their investment portfolios by incorporating cross-products, running quantitative macro/micro portfolio construction models, and extending global reach within investments. At the same time, they need to adhere to all new regulatory requirements and reporting demands, in addition to maintaining and improving the efficiency of operations.

Asset management firms (AMFs) and their management need to understand the advantages of IBOR and the further sophistication of the IBOR Services Matrix.

“Asset managers need to be careful not to get caught in the hype of IBOR,” says Jay Wolstenholme, a senior analyst with Celent’s Securities & Investment practice and author of the report. “In order to reach an optimal SOA framework, the fundamentals of the IBOR Services Matrix need to be understood.”

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is part of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

Executive Summary

1

 

Key Research Questions

1

Seven Critical Reasons to Adopt the IBOR Services Matrix

2

 

Derivatives or Any Multilegged Investment Vehicle

2

 

Collateral Management/Funding

3

 

Compliance/Regulatory

3

 

Portfolio Analytics/Risk

3

 

Fees and Expenses

4

 

Client Reporting

4

 

Real Time

4

Six Key Technical Factors

5

 

Core Principles

5

 

Essential Black Box Design

6

The Asset Management Services Matrix

8

 

Essential IBOR Components

8

 

The Complexity of Reality

9

 

A Global, Multi-Site Asset Management Scenario

10

 

The Asset Management Services Matrix

11

Conclusion

14

Leveraging Celent’s Expertise

15

 

Support for Financial Institutions

15

 

Support for Vendors

15

Related Celent Research

16

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