GB2473646A - Financial asset management system - Google Patents

Abstract

In a financial environment, particularly in relation to fund investment, a financial asset management system including a platform configured to operate as an intermediary between a database and at least a first and second user interface, typically graphical user interfaces GUI's, such that the database contains a plurality of asset accounts, with each asset account having at least one designated manager and a plurality of designated investors. The platform is configured to provide the first interface with a first set of operations for interacting with the database, and the second interface with a second set of operations for interacting with the database. The first interface (101-107) is intended for use by a manager and the second interface (91-95) is intended for use by an investor and the first and second sets of operations differ in dependence upon the different interests/roles of the investor and the manager respectively. A method of searching includes identifying financial investment assets search results based upon a criterion and ranking the search results based upon a plurality of obtained fund characteristics.

Description

Investment Management System and Method

Field of the Invention

The present invention relates to a computer-implemented system and method used in relation to the management of investments, particularly financial investment funds.

Background

The financial industry is a complex one, with one component being that of fund investment. Funds are entities which raise money from investors and invest the money in a group of assets in accordance with a stated set of objectives.

Investment in funds is particularly suited to investors who want to be able to choose to invest in a particular classification of investments/assets (e.g. stocks such as London shares, US property or Russian energy companies, bonds and money market instruments), without having to study the characteristics of the individual assets. Private bankers, pension fund trustees trust managers or other advisers often direct some or all of their clients' assets towards fund investments.

Fund investment spans the gamut of riskiness (and reward) from ultra-safe, low-yielding bond funds at one extreme to highly-leveraged derivative hedge funds at the other.

A hedge fund is an investment fund open to a limited range of investors that is permitted by regulators to undertake a wider range of investment and trading activities than other investment funds and pays a performance fee to its investment manager. Each fund has its own strategy which determines the type of investments and the methods of investment it undertakes. For example, a "fund of funds" (FoF) is an investment fund that uses an investment strategy of holding a portfolio of other investment funds rather than investing directly in shares, bonds or other securities. This type of investing is often referred to as multi-manager investment.

* Hedge funds, as a class, invest in a broad range of investments including shares, debt, commodities and prime brokerage products.

Prime brokerage is the generic name for a bundled package of services offered by investment banks and securities firms to hedge funds and other professional investors needing the ability to borrow securities and cash to be able to invest on a netted basis and achieve an absolute return. The business advantage to a hedge fund of using a Prime Broker is that the hedge fund's collateral requirements are netted across all deals handled by the Prime Broker.

Recent turbulence in global financial markets has severely impacted both fund performance and investor confidence, and has forced regulators to scrutinise the investment industry more than ever before.

As the industry faces significant change in the form of regulation, consolidation, reduced asset allocation and revised fee structures, asset managers in particular are increasingly facing a difficult situation of having to demonstrate comprehensive operational and risk management control and offer transparency whilst facing intense pressure to minimise expenses and lower fees.

In this turbulent industry, managers failing to evolve will find it difficult to attract and retain progressively sophisticated investors. Further, there has been an upsurge in the number of clients requesting a managed account solution, and also an increase in operational complexity brought on by a trend in multi-prime, multi-managed accounts. This has created an immediate requirement for a Valuation Service Provider (VSP)/prime-broker agnostic technology solution to maintain aggregated portfolio information on behalf of both clients and fund managers and regulators. By "agnostic", it is with reference to the fact that the shared platform has been developed as an open architecture with the ability to interface with a * universe of financial service providers such as the valuation service providers, risk service providers, fund databases, and prime-brokers, i.e. decoupling investment choices from technology requirements.

With so many different parties involved in the web of investments, it is difficult for both regulators and investors alike to fully comprehend and follow the various relationships and management terms.

The problems have also been heightened by initiatives of global regulatory reform requiring funds to more strictly comply with operating regulations. For instance, the FSA has recently proposed holding individual senior managers responsible for compliance breaches. This includes a failure by management to implement appropriate systems and controls to prevent breaches by staff. Hedge funds managers are therefore understandably nervous about the FSA's proposals, particularly smaller managers who may not have a dedicated in-house compliance team.

There is therefore a need to make the management of funds, such as hedge funds more accountable and transparent to other parties, particularly their investors and potential investors.

Summary of the Invention

According to one aspect, the present invention provides a financial asset management system including a platform configured to operate as an intermediary between a database and at least a first and second user interface, such that the database contains a plurality of asset accounts, with each asset account having at least one designated manager and a plurality of designated investors. The platform is further configured to provide: the first interface with a first set of operations for interacting with the database, and the second interface with a second set of operations for interacting with the database, such that the first interface is intended for use by a manager and the second interface is intended for use by an investor and the first and second sets of operations differ in dependence upon the different interests/roles of the investor and the manager respectively.

The platform may also be configured to provide a third user interface with a third set of operations for interacting with the database, such that the third user interface is configured for use by a regulating entity and/or other financial service provider and the third set of operations also differ from the first and second set of operations in dependence upon the interests/roles/characteristics of the regulating entity.

It is also preferable that the platform is further configured to facilitate data exchange between the different interfaces.

In this way, in one aspect, the present invention provides a platform where in effect different types of users are able to make use of the same data, but with different usages which are dependent upon their own interests and requirements. A further advantageous feature is that the different users are also able to interact with each other in relation to the data. For example, an asset manager is able to interact with a regulating entity regarding the setting of the asset's Net Asset Value (NAV).Preferably the asset accounts relate to funds, including hedge funds.

In this regard, using a shared technology operation model, it becomes possible to offer a full service front and middle office investment technology solution for investors, fund managers and operations outsourcing service providers in a multiple managed account, multi-broker context.

A prime beneficiary of this new operating model is the investor, who is provided with greater transparency, particularly through better reporting based on the integral relationship between the operations of the funds and their service providers.

The present invention is also advantageous to fund managers, particularly larger ones, as the new operating model provides them with greater control and accountability in managing their various portfolios, and allows them to keep pace with the growing demands for transparency, disclosure and investment control by investors.

Moreover the present invention, particularly the permissioning model, allows managers to keep the industry regulators up to date with timely information regarding the operation of the funds that is independently collated and stored. This provides the regulators with an independent audit trail of investment activity and compliance failures. The present invention also enables regulators to be granted access to the data in real time. Additionally, there is the option to delay and aggregate the release of information to other stake holders. Hence, access to the data, its frequency, granularity and timeliness via the invention allows the users to control access, provide transparency, disclosure and an audit trail of activity, without compromising confidential commercially sensitive trading strategies.

Further, advantageously the present invention provides a platform usable by multiple distinct fund managers. This capability of sharing a technology platform not only vastly simplifies the communication between clients and managers, but also advantageously provides the ability to connect the business operations of managers and investors using a consolidated framework.

* In another aspect, the present invention provides, in a financial environment including a plurality of asset accounts, asset managers and investors, an asset management system for managing the plurality of asset accounts, the system including: a first asset account having at least a first user being a manager of the asset and a second user being an investor in the asset; a second asset account having at least a third user being a manager of the asset and a fourth user being an investor in the asset; a system manager for managing a plurality of asset accounts including the first and second asset accounts, the system manager configured to: manage access to the first asset account by the first user and the second user, such that the first user has a first access rights level and the second user has a second access rights level; manage access to the second account by the third user and the fourth user, such that the third user has a third access rights level and the fourth user has a fourth access rights level; provide the first user and/or the second user with access to at least a portion of data from the second asset account; and provide the third user and/or the fourth user with access to at least a portion of data from the first asset account; such that at least some of the data of the asset accounts in the asset management system is shared between users of different asset accounts.

Other aspects of the invention are set out in the attached claims.

Brief Description of the Drawings

For a better understanding of the present invention a number of embodiments will now be described, by way of example, with reference to the accompanying drawings, in which: Figure 1 illustrates a schematic diagram of an investmentlasset management platform according to an embodiment of the invention; S Figure 2 illustrates a schematic overview of the interaction of the asset management platform with system users according to an embodiment of the invention; Figure 3 illustrates a flow chart of a data permission model for allowing access to the asset management platform according to an embodiment of the invention; Figure 4 illustrates a flow chart of a search technique for searching data on the asset management platform according to an embodiment of the invention; Figure 5 illustrates a flow chart of a rebalance optimizer technique performed on the asset management platform according to an embodiment of the invention; Figure 6 illustrates a flow chart of a subscriptionlredemption/rebalance process performed on the asset management platform according to an embodiment of the invention; Figure 7 illustrates a flow chart of a Net Asset Value (NAV) approval process performed on the asset management platform according to an embodiment of the invention; Figure 8 illustrates a scenario forum performed on the asset management platform according to an embodiment of the invention; Figure 9 illustrates an example Graphical User Interface usable by a fund investor in constructing and managing a fund portfolio; Figure 10 illustrates an example Graphical User Interface usable by a fund * manager in managing a portfolio; Figure 11 illustrates an example Graphical User Interface usable by a fund manager in rebalancing a portfolio, such as described in relation to Figure 5; and Figures 12, 13 and 14 illustrate example Graphical User Interfaces for implementing a SmartRank search, such as described in relation to Figure 4; and Figure 15 illustrates a schematic overview of the interaction of the asset management platform with system users according to an embodiment of the invention.

Detailed Description

The finance industry, for all its regulation, complex fund structures and supposed transparency is one that has to date not been adequately managed. Procedures, such as approving a fund's Net Asset Value (NAy), although regularly performed for all funds, generally entail multiple emails and phone calls between the fund managers, the approval members and the regulatory authorities. Information to investors is also not adequately managed, and so many investors and potential investors feel they are not privy to sufficient information to confidently make investment decisions.

These inadequacies are addressed by the embodiments of the present invention, which provide a centralised asset management system that is configured to * manage both communications between the relevant parties, and also manage procedures in the operation of the asset, where the asset is, for example, a fund structure. In this regard a fund structure includes a singular manager fund, and a multi manager fund of funds.

The schematic diagram of Figure 1 illustrates an asset management system including a central unified asset/investment management platform (10), typically implemented on a server, that has access to a plurality of databases. The plurality of databases may include a plurality of asset databases, such as hedge fund database (1 la). Each asset database is in turn associated with a number of management databases, such as a security position database (1 ib), a security transaction database (11 c), an investment manager database (lid), an authentication database (lie) and a customer relationship management database (11 f). These management databases manage access to the data of the asset database (II a). These databases may be integrated into the management server (10) or separated therefrom. For instance, one or more of the databases may be located remotely from, but be accessible by, the management server (10).

The investment/asset management server (10) is one that is configured to be used by various different fund managers, not only to manage their own funds, but also to correspond and exchange information with other users of the platform, including other fund managers, investors, potential investors and industry regulators. In this regard, for each fund database (1 Ia), at least one fund administrator (12) will be designated, and their access level to the fund database will be managed by the authentication database (lie). Investors will also have access to the data in the hedge fund database (1 la), and their access level will again be managed by the authentication database (lie). Typically the investors' level of access will be lower than the Fund Administrator's level of access. For instance, an investor will have rights to only access at least a portion of the data in * the fund database (I Ia), whilst the fund administrator will have rights to modify, as well as access, the data.

The management server (10) will also be capable of exchanging data/information with other sources including counterparties such as prime brokers (13) and investment companies (14). Further sources including security data providers (16), providing position level data for investment transparency,, risk management systems (17) providing specific risk management techniques that can be used to scrutinise an investor's portfolio risk, and, fund accounting systems (18) providing the information necessary for performing shadow accounting calculations.

The database may also be used to store relevant communications, documentation and other related media, as deposited by users, such as managers and/or investors.

That is, the database may be utilised as a centralised repository for such information in order to allow the users to organise, store and share the information. For instance, this feature is useful from the viewpoint of regulatory auditing as it can allow full client history "at a glance", including meetings, notes, emails, documents, account transactions and relationships. This can therefore provide auditors with a clear trail of system activity that can be readily accessed, and accordingly provide transparency for investors whilst eliminating the need for managers to perform additional work.

Figures 2 and 15 provide overviews of the information flow between the management server (10) and its users and information sources.

The fund administrator/investment manager (12) is typically the entity with the most interaction with the server (10), as the investment manager has responsibility for the day to day operations of their fund (I I). For instance, the investment manager (12) is responsible for instigating trades and managing the fund's positioning and strategy, managing break queries (i.e. where there is a difference between the manager's records and the fund's independent fund accountant (VSP), as well as cancelling and correcting regular NAV sign offs.

* Where the investor is a Fund of Funds (F0F) (14), each fund in the portfolio will have a fund manager (12), which feeds the FoF (14) this information.

Prime brokers are effectively investment banks and securities firms which offer intermediary investment services to hedge funds and other professional investors.

For instance, a fund manager (12) will typically use a prime broker (13) to effect trades required by their fund. Therefore, when a fund manager (12) requests a prime broker (13) to effect a trade, the prime broker may communicate with the investment management server (10) in order to obtain reconciliation information on trades, positions and/or cash balances before effecting the trade.

The Fund Manager (12) may also be given the functionality of setting user permissions to access the fund data, otherwise this may be performed by the Owners of the Fund (152).

Additionally, counterparts (20) which trade in Over-the-Counter (OTC) securities (being securities which are not traded on an exchange, usually due to an inability to meet listing requirements) can provide Counterparty statements, term sheets and confirmations to the management server (10). This information can be considered to be in addition to that provided by the funds (11), to be used by the central server (10) in its search information provided to users upon requesting investment information.

The central platform is configured to use the fund information (11) and OTC securities information, if applicable, in a number of different ways. For instance, the platform can use the information to perform various tasks/flinctionalities/operations, including compiling trade and client reports, Net Asset Value (NAV) summaries, Product Valuations, Risk Management Assessments, Manager Due Diligence, Valuation Service Provider (VSP) (i.e. an independent Fund Administrator, typically an accountant) Due Diligence and also Quantitative Analysis Reports.

Users, particularly investors (151), which subscribe to the management system (10) can then access these valuations, reports and the like. In view of the enhanced interaction between the different funds and regulators, the investors can be assured of greater transparency of the available data, as well as better visibility and control.

From the point of view of regulators (150), the platform provides a better degree of control and transparency as well. For instance, in relation to OTC securities, to date broker/dealers have negotiated directly with one another over computer networks and by phone. Whilst these activities are monitored by an appropriate regulatory body, these communications can be difficult to track. Further, as OTC stocks are usually very risky, since they are stocks that are not considered large or stable enough to trade on a major exchange, any enhancement in their regulation is welcomed.

Some of the particularly advantageous functionalities and operations of the management system will now be described.

Data Permission Model Figure 3 provides an example of one of the functionalities that the central management server (10) is configured to perform, according to an embodiment of the invention. In this regard, Figure 3 illustrates an example flow chart for a process of the management server (10) administrating user permissions for access to data on, or associated with, the server.

For instance, the platform will hold a control list (31) defining the extent of users' access to the different funds managed by the platform. As shown in Figure 3, the "users" of a fund include managers of the fund (30a), as well as investors (30b) in the fund. Therefore, two different examples are illustrated, of User A (30a), a manager of Fund B requesting access to Fund B, as well as User C (30b), being an investor of Fund B, requesting access to Fund B. The platform (10) will use the Funds' Access Control List (31) to check to see if the users are members of Fund B (32). This Control List (31) would typically be stored in the authentication database (lie). If the user is not found to be a member of Fund B, a default process of issuing a request to access Fund B (33) is provided.

For instance, if User C (30b) was an investor of Fund B, but had not yet registered to access the data of Fund B, then the platform would send a request to access the Fund (37) and a decision on the matter (38) to grant or deny access made by a manager/administrator of the Fund (35a). If the manager recognises user C as an unregistered investor, then they can update Fund B's Access Control list by adding user C as a member. Alternatively, this default request mechanism (33) could be used to change a user's access level to the Fund.

However, if the user is found to be a member of the Fund, which is the case for users A and C, then, where different access levels are provided, the platform will check the requesting user's access level (34). This step is advantageous in order to provide different types of users different degrees of access to the fund data, such as viewing only (e.g. for investors/potential investors) and the right to modif' the data (e.g. for fund managers). Other levels of access may be provided as required.

For instance, a prospective investor level may be provided, which only provides such a user with a restricted view of the total data available in the Fund (36).

Further, where a fund has more than one manager, different levels of access may be provided to each manager. For instance, where the managers have different responsibilities, different modification rights may be implemented.

O

In the Figure 3 example, the minimum role/access level is given to investors, so where the user's access level is found to be greater than the minimum access level, the user's role is determined to be that of a manager (35a) and the user (e.g. user A) is given the ability to access and modify the information and performance data of Fund B (36). Otherwise, if not, the user's role is determined to be that of an investor (35b) and the user (e.g. user C) is only given the right to access, but not modify, the information and performance data of Fund B (36). The data that each user can access may be all the data in the fund database, or portions thereof. For instance, different access rights may be given in relation to accessible documents, contacts and communication history data.

Once a user has obtained access to the data of a fund on the platform, then other functionalities may be performed by the platform (10). For instance, the ability of a user to search the server's databases is a vital feature of allowing greater transparency for users. In this regard, the data will typically be stored with a minimum permission level, as well as suitable tags for classification purposes. In relation to the tags, descriptors using a hedge fund style are preferably provided, although fund managers may also insert their own proprietary descriptors for a more targeted construction. This enables searching of the funds to be performed quickly and simply.

Smart Rank One such functionality that utilises the classified data, according to a further embodiment of the invention is termed herein "Smart Rank". Smart Rank is a search tool that provides the ability for users, including investors and managers alike, to intelligently and intuitively search and collate funds, particularly in regard to conducting research or with a view to investing in those funds (i.e. portfolio construction). An example of Smart Rank is illustrated in relation to Figure 4.

This searching mechanism utilises numerous qualitative and quantitative data points on each fund.

With reference to Figure 4, a user will initiate a search (40) by entering their search criteria, in order to filter the available data. These search criteria will be applied to the "Hedge Fund Universe" (43) which includes data from all available hedge funds, including data from member funds (i.e. from the fund database of the system) as well as any accessible third party fund databases (41), particularly hedge fund databases.

The searching criteria are preferably wholly, or at least partially, selected by the user initiating the search. In this regard, the range of search criteria available for the user is preferably presented to the user in a list of possible options (42), For instance, the user may be presented with the options of filtering the available funds on the basis of various fund characteristics, such as: -region (e.g. global, based on a particular country only, or only developed countries, or only emerging countries), -market capitalization options (e.g. small cap, mid cap, mega Cap); -Asset Class (e.g. Equity, fixed income, currency, Credit or Multi-Class); -risk factors, -strategy type; -assets under management (AUM); -fund type/style (e.g. futures, merger arbitrage, fixed income arbitrage, distressed securities) -and fund status (e.g. funded).

In addition to search criteria based upon fund characteristics in genera!, fund performance characteristics can be taken into consideration. For instance, the funds can be searched based upon a!ist of statistical search criteria (45a) such as by specifying a maximum drawdown level (e.g. equal to or less than 5%) and/or a Year To Date (YTD) return minimum level (e.g. greater than 5%). In addition, liabilities applicable to the funds and/or their managers may be taken into consideration, such as penalties imposed on the fund and/or the fund managers. In this regard, the FSA monitors the operation of funds for any irregularities and imposes penalties for breaches such as market abuse and mis-selling. Therefore, filtering can be applied using the penalty factors, for instance to: -filter out funds with any penalties applied whatsoever; -filter out funds with penalties exceeding a certain monetary amount; -filter out funds with any penalties applied in a given period of time (e.g. immediately preceding 12 months);and/or -filter out funds with penalties of a certain type (e.g. market abuse penalties).

In view of the large number of funds available worldwide, depending upon the strictness of the search criteria specified, the search is still likely to reveal hundreds of results, if not more, that match the criteria, so it would be an onerous task for the user to review all results.

Therefore, according to this embodiment of the invention, once the user's initial search criteria has been applied to the data, and the search results obtained, an intelligent ranking algorithm (46) is applied.

The algorithm is configured to reuse the search criteria in order to provide a parameterisation of the search results. That is, the algorithm provides weightings between the statistical criteria and penalty functions. These weightings may be predefined or at least partially specified by the user. For instance, the statistical search criteria may be specified by the user in an order of importance. This order of importance may then be applied to the predefined weightings, in order to adjust their significance, as per the user's specification.

Although preferably the general fund characteristics (42) are not taken into account in the algorithm, in an alternative embodiment, this is a possibility. For instance, funds could be sorted according to different penalty and statistical criteria weightings, and then presented on a regional basis.

In this way, this embodiment of the invention provides a forum for users to search numerous funds, where the funds are typically operated by independent parties.

These embodiments of the invention therefore empower users to build their own bespoke portfolio of funds from the top down, whilst fulfilling a complex set of investment guidelines.

Rebalance Optimiser According to another embodiment of the invention, the system is able to provide a mechanism for rebalance optimisation of a portfolio, and an example is illustrated in relation to Figure 5.

This rebalancing is normally used on a discretionary basis when a user's portfolio is off-target. In practice, this is likely to happen fairly regularly, since fund weights will change as share prices move. Also other factors that may unbalance a portfolio are currency fluctuations.

In this regard, if the user finds that their portfolio is off-target, then they can input their targets (50a, 50b, 50c) into the optimiser. These targets may be one or more of a target cash balance (50a), target weightings (50b) and optimiser options and their parameters. For example Keep cash >$ 10,000, rebalance only if target weight to current rate is >2%, The optimiser, upon receiving these target values, obtains the user's current portfolio (52) and the underlying weights and cash balance, and compares them (51) in order to determine any differences/discrepancies. Where a discrepancy or discrepancies between the actual and target values exist, the optimiser draws on the fund database to determine fund information/characteristics that will be relevant to the rebalancing process, such as fund liquidity terms and redemption fees (53).

In this regard, according to a preferred feature of this embodiment of the invention, the optimiser can rebalance the user's portfolio from a number of different perspectives, including one that minimises the number of fund transactions (54) or one that minimises the fees payable (55). In this regard, every transaction costs money, and so these costs should also be taken into consideration for the most effective fund optimisation that arrives at a portfolio which satisfies the target weights (56).

For instance, if the investor's portfolio had a target weight of 20% banking shares, 30% natural resources shares and 50% shares of any type and a cash balance of £100,000, if the actual cash balance dropped to £80,000, banking shares decreased to 15% natural resources shares increased to 40% and the other shares decreased to 45%, then an imbalance would result. Based upon the perspective selected, the optimiser will determine the most appropriate approach for rebalancing the portfolio. This may be simply through selling a certain type of natural resource share to increase the cash balance and adjust the portfolio weights, or may include buying up of a certain stock, such as a banking share in order to redress the imbalance.

This is preferably performed in a recursive fashion, so that a number of possible optimisation solutions are provided to the user to select from. Alternatively, the optimiser performs the rebalancirig automatically, and upon finding an optimisation that satisfies the new portfolio's weights (56), the rebalance process is commenced (57).

Fund Subscription RedemptionfRebalance Process Another embodiment of the invention which becomes possible through the use of a central platform is that of providing a central mechanism for subscribing to, redeeming and rebalancing a fund.

In this regard, with reference to Figure 6, it is the managers of a fund (60) who have the responsibility for managing subscriptions, redemptions and rebalancing of the fund portfolio (61). The rebalancing in this context differs from the rebalancing in Figure 5, as in Figure 5, it was rebalancing to meet target weights, and here it is rebalancing of the actual target weights.

Portfolio amendments, such as newly proposed weightings (62a), that are proposed by a portfolio manager, such as user A (60), need to be approved by the approval members (63), who are typically the other fund managers. Upon being notified of the proposed changes, the approval members (63) respond by approving or declining the proposal. Alternative, an approval member may request a review of the proposal, and therefore reply "under review". Where at least one member declines the proposed weights (64a), typically revised new weights are proposed (62b) by the initial proposer, user A, and these revised weights are again put forward (62a) to the approval members (63). This process with continue until all members approve the changes.

Where at least one member requests that the proposal be reviewed, a review procedure takes place (64b). In practice this is most likely to occur when no consensus can be reached between all the approval members (63). Where this review decides to accept the proposed portfolio with no changes, then the members who requested a review will have their status changed from "under review" to "approve". Alternatively, where the review decided to modify the weights, then the adapted weights (62b) are put forward, with all approval members resetting their approval status to "approved", as necessary.

It is to be appreciated that there at least one member declines an amendment proposal, and at least one member requests a review, the declining view preferably will take precedence, so that user A will need to propose new weights to be put to the approval members, before a full review of the proposal takes place.

With all members approving an amended portfolio proposal, the amendments are submitted (65) in order to effect the required transactions. With the fund transactions submitted, it is determined if the fund transactions are allowed (66a), with reference to the fund database (66b). For example, the allowability of the transactions are determined with reference to liquidity and investment terms of the funds sought to be redeemed, rebalanced and/or subscribed to. If the funds are allowed, the transactions are committed to (67a). As it is not always possible to immediately effect the transactions, where the transactions are pending, the fund managers are typically notified of the pending situation (69), before the transactions are eventually executed in order to complete the portfolio subscriptionlredemption/rebalance (68).

Alternatively, if at least one of the underlying fund transactions are rejected (67b), the portfolio weights are modified, and the revised portfolio (62b) again put forward to the approval members for review.

NAV Approval Process In a further embodiment of the invention, figure 7 shows an approval process of the Fund Net Asset Value (NAV) utilising the central platform. The NAV is effectively the stock price of the fund. In this regard, it is standard practice in the finance industry for the administrators of a fund to calculate the NAV of their fund at regular intervals, such as every month or every week. There are various pricing models that may be utilised, but the final result is managed by Approval Members (76), who are typically independent parties. The approval members are predetermined, usually by the fund managers.

When it is required to determine a Fund NAy, the process shown in Figure 7 will be instigated (70a), which involves determining the proposed Fund NAV (70b) using the data available on the Fund Administrator's data server (70c).

The fund data obtain (70b) will then be analysed to assess whether the data is "clean" and of a proper format (71). In this regard, this analysis essentially involves ensuring that the data makes sense. This may be achieved by a comparison with the previous NAV and/or the fund data (70c) used to calculate the NAV. If the data is found to be "dirty" (72), and not of the form expected and/or not within an expected range, then new data is requested from the Fund Administrator, which recalculates the NAV.

If, however, the NAV is found to be "clean" and of the proper format, the data is put forward for approval (73). The approval members (76) review the proposed NAV value with reference to the fund's data and/or general market data, and either approve, decline or request a review of the NAV.

Where at least one member declines the proposed NAV (74), the data is considered to be incorrect (75), and new NAV data requested from the fund administrator, who recalculates the NAV value, and the approval process is repeated. If a stalemate is reached regarding the data, with not all approval members agreeing to approve the NAV value, the matter will be put to a formal review, in the same manner as described in relation to Figure 6.

Once all members have approved the fund NAV (77), the value will be committed to and used in relation to the fund (78).

Scenario Forum In a further embodiment of the invention, an additional functionality of the central platform relates to the building and testing of portfolio "scenarios". With reference to Figure 8, a user A (80) creates a new scenario B (81). This scenario may specify particular stocks, funds and quantities thereof to analyse, as well as start and end dates, for the scenario data to be analysed over a certain period of time. Further factors may also be defined, particularly with a view to "stress testing" the scenario (81). For instance, a percentage change of selected factors, such as different liquidity predictions or fund fees, during the specified time period (82a) may be stipulated. The stress testing takes place against one or more risk factors, which may be determined with reference to a database of system risks stored on the platform (82b). For instance, a given scenario could be stressed tested against a risk model, for example against a risk of 68% Variance Decomposition, as well as 95% and 99% Variance Decomposition and the results compared. Further, a fee simulator based on the track record of the fund's performance may be implemented.

With these parameters specified, the central platform applies the scenario to an appropriate market template/risk model, and outputs data defining how the portfolio would look after experiencing the specified scenario for the specified period of time. For instance, a risk and return profile may be obtained.

Alternatively, or in addition, the performance based on different fees may be considered, or optimisation analysis based on defined weights.

Advantageously this stress testing may allow portfolio managers to find factors that correlate and use this information to create an overlay strategy for the portfolio. In particular, by running the fund analysis on particular factors, it can be assessed whether any particular factor is able to achieve excess returns above "alpha" factors (i.e. variance and return decomposition based on historical returns).

A particularly advantageous feature of this embodiment of the invention is that it is possible for the user A (80) creating the scenario to define a scenario sharing property in order to share the scenario with other users (83a). Where this sharing property is specified (83a), Scenario B is saved on the platform (84). By saving the scenario on the platform a forum is effectively created where members of the Nexus platform are able to access the scenarios. This access may be open, whereby all users may access the scenarios without specific permissions being required. Alternatively, access may be available to only certain users. For instance, with reference to Figure 8, user C (85a) may request access to Scenario B (85b). If access is open, or if user C has been pre-approved, then user C will be allowed access to scenario B in order to stress test their portfolio (86).

If however user C does not have the right to access scenario B, then a request may be put to user A (the creator of the portfolio) for user C to use Scenario B (87).

User A (80) wifl then either accept the request or decline it (88). The result of this decision is then saved in relation to the scenario on the scenario forum (84) for future reference, and user C provided with access to the scenario (85b, 86), if approved.

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The sharing of scenarios can also be advantageous for user A, the creator of the scenario, as ideally they get to view the results of the third party stress testing, and the third parties may apply tests not considered by user A. Further, peer groups may be created, with the peer groups identi1'ing and testing funds that they are interested in. Based upon the scenario analysis, users may subsequently request to be a prospective investor.

Examples of users who may be permitted access to the scenarios on the scenario forum (84) include students and university researchers, who, once registered with the platform, can thereafter access it remotely in order to test the trading models/scenarios. In this regard, as the trading models typically simulate an investment bank/trading floor they can be tested against past trading data to see These functionalities of the management system are accessible to the users of the system via one or more different interfaces. These interfaces are typically a Graphical User Interface (GUI) downloaded onto the user's computer. Different interfaces are ideally provided, which are dependent upon the requirements of the user. For instance, since fund managers will have different requirements for the management server to other users, and so will be provided with an interface specifically providing the functionalities required. In a similar manner, regulators may also be provided with an interface providing a different set of relevant functionalities, and investors another variation. This enhances the usability of the data from the user's viewpoint since non-relevant functionalities are not presented S to the user.

These interfaces may be provided via separate GUIs specifically designed for the different user types, or via the one interface whose presentation is adaptable depending upon the type of user registering into the system. There may be overlap between the functionalities provided to each different type of user.

In addition to interacting with the central management server, the different interfaces are also configured to interact with each other, in order to allow the exchange of communications and information between the different users.

Figure 9 illustrates an example GUI illustrating functionalities useful to an investor. The illustrated section of the Figure 9 GUI shows a portfolio construction interface which provides the investor with the ability to optimise their portfolio weights 91, and add or delete funds from their portfolio (92). This GUI also provides the user with graphical illustrations of performance and allocation information across the portfolio (93). Further, an overview of key fund risk and return information (95) is also provided, as well as the ability to display a risk and return chart (94).

From the tabbed options shown in Figure 9, it can be seen that other functionalities may also be provided to the investor, including detailed fund summaries, liquidity modelling tools, Figure 10 illustrates an example GUI illustrating functionalities useful to a fund manager. The example of Figure 10 provides an overview of key fund information (101) such as the NAV, fund status and fee information. This GUI also shows a log of all recent fund activity (102) and cash management information (103). A tab to obtain greater details (106) on this key fund information is provided, which for S instance may provide the manager with more detailed corporate information.

Further a liquidity management facility (107) is also provided via this manager GUI. This is a functionality that may also be provided to investors (i.e. see "liquidity" tab in Figure 9 GUI). This functionality enables investors and managers alike to model liquidation scenarios, in order to provide a clear indication of the impact the liquidation will have on the fund return profile. For instance, the user may select the percentage of the portfolio that they are considering liquidating and then graph the cost impact of liquidating that chose percentage.

From the tabbed options shown in Figure 10, it can be seen that other functionalities may also be provided to the manager, including the ability to upload and share fund documentation (104) and view a summary of investor actions (105), such as investor redemption, subscription and rebafancing actions.

Figure 11 illustrates an example GUI for managing a portfolio rebalance. This interface provides information regarding the current cash available in the portfolio, as well as the portfolio NAV and rebalance constraints (e.g. the minimum rebalance amount). A built-in rebalance optimiser (110) is provided, which is configured to utilise the actual and target fund weights to arrive at a rebalancing proposal. Trades are also able to be enacted directly through this GUI (111) and the approval of the rebalancing is also able to be initiated, managed and tracked (112) via the GUI.

Figures 12, 13 and 14 illustrate example GUIs that may be utilised in relation to the SmartRank search functionality. Figure 12 illustrates a "quick search" option, which provides some set criteria (120) which the user may use in their fund search, such as particular asset classes, fund region, market capitalisation type, track record and fund style. This is often referred to as top down searching.

Bottom up searching is also provided in this GUI by providing the user with the ability to search by company, fund and fund manager keywords (122).

The GUI in Figure 12 also enables users to save their search criteria in a "favourites" menu (121), enabling them to return to the search at a later date, or even share the search with other users.

Figure 13 illustrates a customisation facility that may be incorporated into the SmartRank search, which enables users to customise their search in terms of the ranking procedure 130 as well as the filtering criteria 131. For instance, in terms of ranking, the user may specify that funds that they are particularly interested in are those with a performance return of equal to or greater than 5%. In terms of filtering, the user may specify particular criteria to be incorporated into the search criteria 132. The customised options may also be saved separately for future use in other searches 133.

Figure 14 illustrates the SmartRank search results. The results are listed in a table according to their SmarRank grading for targeted analysis 141. A graphical representation is also provided in relation to the search results, which in this example is a heat-map, fully customisable in terms of performance variables and time horizons 140. The illustrated heat-map is in relation to the Sharpe Ratio (which compares the relative return to the underlying volatility in the investment) for the period of time since the assets' inception.

Based on the search results, a user can then select funds to be added to their portfolio, a watch list, or a peer group for future analysis (142). The user is also able to view more details on the funds (143), such as fund risk and performance information, graphing of the fund's NAV, historical VaR and drawdown information.

Advantageously these embodiments of the invention enable the entire business flow of the asset management industry to be tied into one framework, enabling greater access to data for all parties involved, and, correspondingly an aggregated/consolidated view of risk and investors.

The functionalities described in the various embodiments of the invention are not to be considered in a limited sense, as further fünctionalities are possible. For example, the investment management platform may be configured to produce monthly performance document for the portfolio and distribute these to the applicable investors. Additionally, alerts may be set up for each fund and/or portfolio based upon the fund's investment focus.

Claims (24)

1. CLAIMSS1. A financial asset management system including a platform configured to operate as an intermediary between a database and at least a first and second user interface, such that the database contains a plurality of asset accounts, with each asset account having at least one designated manager and a plurality of designated investors, and the platform is further configured to provide: the first interface with a first set of operations for interacting with the database, and the second interface with a second set of operations for interacting with the database, such the first interface is intended for use by a manager and the second interface is intended for use by an investor and the first and second sets of operations differ in dependence upon the different interests/roles of the investor and the manager respectively.
2. 2. The system of claim I wherein the platform is further configured to facilitate data exchange between the first and second interfaces such that the exchanged data relates to at least one of the plurality of asset accounts.
3. 3. The system of any one preceding claim wherein the platform is further configured to provide a third user interface with a third set of operations for interacting with the database, such that the third interface is intended for use by a regulating entity and or other financial service providers, and the third set of operations also differs from the first and second set of operations in dependence upon the interests/roles/characteristics of the regulating entity.
4. 4. The system according to any one preceding claim wherein each investor has an asset portfolio including at least a portion of the plurality of asset accounts, and the first set of operations that the platform is configured to provide the first S interface with include: a first subset of operations for allowing the investor to interact with the plurality of asset accounts as a whole, and a second subset of operations for allowing the investor to interact with their asset portfolio.
5. 5. The system of claim 4 wherein the first subset of operations include at least one of the following: a functionality configured to allow the investor to analyse the performance of asset accounts outside their asset portfolio; a functionality configured to allow the investor to search the database for any asset accounts matching a designated criterion; and/or a functionality configured to allow the investor to request an asset account to be incorporated into their portfolio.
6. 6. The system of any one preceding claim wherein the platform is configured to communicate with a plurality of first interfaces in order to facilitate a plurality of managers in managing their respective asset accounts.
7. 7. The system of claim 2 wherein one of the third set of operations includes monitoring procedural compliance of the plurality of asset accounts.
8. 8. The system of claim 2 wherein one of the third set of operations includes further including a third user interface configured to provide at least one regulating entity with a third set of operations for interacting with the database, such that the third set of operations also differs from the first and second set of operations in dependence upon the interests/roles/characteristics of the at least one regulating entity.
9. 9. The system of any one preceding claim wherein the platform is further configured to exchange information with an interface associated with at least one of: S a fund accountant; a prime broker; an investment company; a hedge fund provider; and/or a market data provider.
10. 10. The system of any one preceding claim wherein the platform is further configured to control the sets of operations using an authorised user access control list relating to each of the plurality of asset accounts.
11. 11. The system according to any one preceding claim wherein the first set of operations that the platform is configured to provide includes one or more of the following: an operation allowing a manager to rebalance their asset account; an operation allowing a manager to redeem a portion of their asset account; an operation allowing a manager to search for new asset accounts to incorporate in their asset account; an operation allowing a manager to seek approval of a determined Net Asset Value of their asset account; and/or an operation allowing a manager to control other users' access to the asset account data.
12. 12. A user interface configured for use in the system of any one of claims 1 to 11.

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13. 13. The user interface of claim 12 wherein the interface is a second user interface configured for use by a manager and the interface is further configured to interact with one or more investment entities, with the second set of operations that the second user interface is configured to provide including undertaking a risk assessment of the asset account using information obtained from the one or more investment entities.
14. 14. The interface of claim 13 wherein the one or more investment entities that the second user interface is configured to interact with includes an interface associated with at least one of: a fund accountant; a prime broker; an investment company; a hedge fund provider; and/or a market data provider.
15. 15. A method of operating a financial asset management system, the system including a database containing a plurality of asset accounts, with each asset account having at least one designated manager and a plurality of designated investors, a first user interface for use by a manager and a second interface for use by an investor, the method including: providing the first interface with a first set of operations for interacting with the database, and providing the second interface with a second set of operations for interacting with the database, such the first and second sets of operations differ in dependence upon the different interests/roles of the investor and the manager respectively.
16. 16. The method of claim 15 further facilitating data exchange between the first S and second interfaces.
17. 17. In a financial investment environment including at least one database of financial investment assets, a method of searching the financial investment assets including: receiving a search request including at least one filtering criterion; undertaking a search using the at least one filtering criterion in order to arrive at a plurality of financial investment asset results that meet the search request requirements; obtaining a plurality of fund characteristics applicable to the financial investment assets; and applying the plurality of fund characteristics to the plurality of search results in order to arrive at a ranked result order.
18. 18. The method of claim 17 wherein the plurality of fund characteristics are each associated with a weighting, each of which are applied to the plurality of search results in order to arrive at the ranked result order.
19. 19. The method of claim 17 or 18 wherein the plurality of fund characteristics relate to: a) a statistical criterion applicable to the assets; and/or b) a penalty applicable to the assets.
20. 20. The method of claim 19 wherein the statistical criterion application to the assets include one or more of: a) a maximum drawdown level; and b) a Year to Date return minimum level.
21. 21. The method of any one of claims 17 to 20 wherein the plurality of fund characteristics are obtained from a direct user input or a database of user preferences.
22. 22. A system substantially as herein described with reference to the accompanying figures.
23. 23. An interface substantially as herein described with reference to the accompanying figures.
24. 24. A method substantially as herein described with reference to the accompanying figures.