Citadel Associates, provider of data management solutions to investment managers, has chalked up three deals for its CADIS system in recent weeks, with AMVESCAP, the Canada Pension Plan (CPP) Investment Board and another as yet unnamed major buy side. Citadel says these wins prove the validity of its Investment Solutions Layer concept.
The CPP Investment Board invests funds not needed by the Canada Pension Plan to pay current benefits. It has selected CADIS as its strategic data management platform. AMVES-CAP is an independent global investment manager, operating under the AIM, AIM Trimark, INVESCO, Invesco Perpetual and Atlantic Trust brands. It has selected CADIS as its global data management platform. Existing CADIS clients include Aegon Asset Management and HighMark Capital Management.
There are several drivers for the growing uptake of systems like its Investment Solutions Layer proposition, according to Citadel’s head of sales and marketing for EMEA Robin Strong. One is the implementation of automated compliance checking or other front office functionality, which generates the requirement to get multiple data sources into that system quickly. Another is the decision to outsource investment accounting or fund administration; having a solution like Citadel’s in place makes it more straightforward to change accounting systems without great upheaval.
CPP Investment Board, AMVESCAP and the soon to be announced third new client are implementing CADIS on a phased basis, in line with Citadel’s standard approach, conceived to enable clients to reach their data goals in manageable chunks. “CADIS has been designed to meet the ROI profile required for asset management projects. This means first-phase deployment in three to four months, getting immediate returns, often with payback inside 12 months,” says Strong.
Other factors in Citadel’s successes with these three firms include the flexibility of the CADIS solution, Strong adds. “The optional data warehouse component of CADIS is an end-point for data, rather than being at the centre of the solution,” he says. “Data warehouses have fixed data structures that are hard to change and have knock-on implications for load scripts, reports et cetera. If you want to trade a new asset class quickly to gain competitive advantage it can take weeks or even months to change a warehouse-centric environment. CADIS is based on dynamic data structures and a flexible schema, with visual mapping tools to allow a business analyst to make these changes very quickly.”
Financial institutions are seeking to extend the benefits of automation beyond securities master and pricing data to encompass other data types, according to Strong. “We are now seeing increased interest in tier two data – composite benchmarks, classifications, analytics and other derived data,” he says. “This is driven by the industry trend of implementing best of breed solutions from different vendors that frequently results in, for example, different classifications used for modeling to those used for client reporting. By centralizing the business processes in a central layer, you get consistency across the organization, reduced data management costs and reduced operational risk.”