The fund management division (FMD) of AmInvestment Bank Group has selected tech vendor SunGard's APT to help support its multi-asset risk modelling, fund risk analysis and fund services reporting. The new system will replace MSCI Barra software and is part of a broader revamp of the division's risk and performance management.
"We are investing in APT to prepare ourselves for more complex mandates and requirements in the market," says Andrew Lian, assistant manager for risk management in the FMD of AmInvestment Services in Kuala Lumpur. "More and more clients are looking at risk-based or risk-adjusted performance and not just pure performance alone."
The FMD also needed to be able to provide its fund managers with margin risks on potential positions, pre-trade analysis and portfolio optimisation tools, and its clients and other stakeholders with daily reporting.
APT will integrate with the FMD's performance-attribution system to provide risk-adjusted return figures, as well as with its internal accounting and asset management systems to provide straight-through risk management.
AmInvestment decided on APT in mid-February, started the implementation on March 30 and has had it in place in its Kuala Lumpur headquarters since June 26. It plans to roll out the system to its subsidiaries in Brunei and Indonesia.
The FMD looked at other offerings, but decided on SunGard due to the system's flexibility, says Lian. "Just to qualify the word 'flexibility'," he explains, "most of the larger providers are moving their offerings towards web-based solutions, which provide the user with the option of running their optimisations and risk numbers off a much faster server based in the providers' HQ."
The main concern with this type of set-up is client confidentiality, says Lian, but on the other hand most web-based interfaces require a lot of manual selection of options on the system. This is not practical for firms running more than 100 portfolios, with predefined optimisation and risk figures to run, he says.
AmInvestment has 182 portfolios under management, "and it further complicates things if the risk numbers and optimisation parameters are dynamic," says Lian. "That is, if we implement a regime switch in our strategies."
APT allows users to code options using the programming language rather than having to manually select them, he says.
The software implementation is part of a wider revamp of how AmInvestment Services looks at the performance and risk of funds under management. The firm is combining three departments -- performance attribution, risk management and strategy development -- with a view to providing staff with greater autonomy to carry out their duties, says Lian.