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From Kirsten Bischoff, Opalesque New York:

As institutional investors move larger portions of their portfolios into alternative investments, and in some cases bring those alternative strategies under in-house management, they are becoming the next big wave of clientele for fund administrators and their administration needs are very different than they were in the past.

“What institutional clients today are looking for is focused much closer to the investment decision-making process – closer to the front office than simply just accounting,” says Tyler Kim Chief Information Officer at global fund administrator Maple Fund Services.

Maples says the challenges it sees facing pension plans is driven largely by the significant funding shortfalls that have them focused on generating additional alpha through investments in alternatives. Other institutional investors are being driven to alternative investments as a source of portfolio diversification and enhanced returns.

At the heights of the financial crisis, and the unraveling of multiple financial frauds, institutional investors were very reactive. They slashed alternative exposures and then demanded that managers who did maintain allocations, or that hoped to gain future allocations increase their own risk reporting capabilities. During that time, many of these investors missed the market rallies, much of which was captured by alternatives ......................

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