In today’s market environment, it has become increasingly important for hedge fund managers to focus primarily on the responsibility of maximizing performance alpha for their clients. By leveraging a reconciliation service provider, this focus becomes even greater and easier to maintain as hedge funds can simultaneously drive operational alpha by tapping them for the below advantages and services:
Cost: Unlike expensive in-house solution deployment, reconciliation service providers offer a cost advantage by streamlining business processes and automating repetitive, labor-intensive tasks. Moreover, to stay relevant in a highly competitive space, service providers invest in advanced and emerging technology like blockchain, artificial intelligence (AI) and machine learning (ML) to achieve process efficiency.
Operational Edge: Reconciliation service providers achieve operational expertise by performing similar functions across their client portfolio. Handing reconciliations for a wide variety of funds, their experience, operational prowess and service specialization cannot be matched by an in-house reconciliation infrastructure that tends to have limited operational exposure.
Service: Outsourcing reconciliation responsibilities to subject matter experts can be a prudent way to maintain heightened transparency and service standards. Integrated reconciliation service providers, with their stringent hiring standards, exhaustive training regimes and rich knowledge base, ensure value maximization for their clients. The outsourcing of reconciliation services also helps to reduce process turnaround time (TAT), while the transfer of reconciliation workshare over different time zones ensures round-the-clock service.
Advisory: Since these providers possess deep expertise in the reconciliation domain, hedge funds can approach them for consulting or advisory services to help resolve a variety of issues and challenges, including the reconciliation of emerging and complex asset classes or implementing industry best practices.