Now more than ever, performance measurement and attribution is a critical aspect of every investment management firm’s investment process.
A new report from Aite Group, LLC looks at the current state of the performance measurement and attribution market as well as the vendors that offer such systems. The report focuses on the capabilities and features offered by 11 profiled vendors and provides background on each.
As investment products become increasingly complex, so does the difficult task of measuring which managers have made truly prescient investment decisions. Determining whether excess return on an investment came as a result of a manager’s decision on sector allocation, security selection, or a combination of several other factors is a complex task, and performing the same analysis on a fixed income fund poses an even greater challenge. A number of vendor-provided performance measurement and attribution systems exist today. While the market for this technology has been dominated by large firms, smaller firms specializing specifically in performance measurement and attribution systems are now gaining ground. The market value of installed performance systems currently stands at approximately US$333 million as of year-end 2007, but is projected to grow at a significant pace as more firms realize that tracking performance and attribution on spreadsheets is not adequate in today’s complex environment.
"Today’s volatile markets have led to a marked increase in interest and attention focused on performance measurement and attribution by many players in the industry," says Phillip Silitschanu, senior analyst with Aite Group and author of this report. "This renewed increase in attention has helped spur system vendors to develop better and more advanced measurement and attribution systems, and interest in these systems will increase dramatically in the coming years."
The report compares the features and capabilities of performance measurement and attribution systems from Base-Two Investment Systems, Inc., BI-SAM, DST International, Eagle Investment Systems LLC, Milestone Group, SS&C Technologies, Inc., StatPro, SunGard, Thomson Reuters, VPD Financial Software Consulting Limited, and Wilshire Associates Incorporated.
This 64-page Impact Report contains 27 figures and three tables. Clients of Aite Group’s Institutional Securities & Investments service can download the report by clicking on the icon to the right.