BNY Mellon Alternative Investment Services has launched a service that independently validates a hedge fund’s position records to third parties – prime brokers, custodians, trustees and agent banks – and independently verifies the pricing of that fund’s securities. The new service provides fund managers and their investors with greater transparency and additional assurance that fund assets are independently priced and validated.
The flexible, highly automated service, with pricing and validation coverage across 50 asset classes, is enabled by BNY Mellon’s extensive relationships with more than 150 prime brokers and counterparties. The service, which can be used to supplement client interface with accountants and independent auditors, can also be customised to meet specific requirements, including tolerance checking across positions, price or market values.
“Hedge fund clients are telling us their investors are demanding an independent validation of their holdings. The price verification/asset validation service helps address this need, which in turn helps hedge funds retain and grow their investor base,” said Brian Ruane, chief executive officer of BNY Mellon Alternative Investment Services. “While our broad network of pricing vendors and counterparties are the power behind this new offering, greater transparency is clearly the motivation.”
Currently, the price verification/asset validation service reconciles more than 27,000 client investment positions, with a total market value in excess of US$24 billion. Client coverage rates (assets validated as a percentage of total portfolio scope and value) are in the range of 95-99%. Clients can elect the service on a monthly or quarterly basis.