Simplifying Technological Transitions in Fund Management through Low/No Code Applications

February 22, 2024

In the intricate dance of fund management, where every tick of the clock is a drumbeat to which capital and strategy move, two resources stand out in their scarcity: time and talent. Imagine, if you will, the best minds in finance, recruited at a premium, their expertise expected to navigate the complex choreography of front and middle office management. Yet, ironically, these experts spend the majority of their time chained to the mundane—manually updating spreadsheets, transferring data between silos, burdened with the dull task of report management. This scene, all too common, drain off the precious resource it sought to harness: the strategic capacity of its talent.

Contrast this with the vanguard of the industry, who recognize that the true utility of talent lies not in its ability to maintain the status quo but to innovate, to question, and to streamline. They invest not just in people, but in empowering them with tools and technologies that liberate their time from the manual to the meaningful. This strategic allocation of resources—where technology and talent converge—transforms potential into performance, enabling funds to not only compete but to lead in the relentless race for returns.

According to a recent survey conducted by Waters Technology in the buy-side sector, 57.7% of firms navigate a complex mix of proprietary, legacy, and third-party platforms, with 73% facing moderate to severe data duplication issues. Over 90% battle with low-quality market and reference data, significantly impacting the middle office. Cloud technology and API adoption are slow, with only 5.7% fully embracing the cloud. These trends highlight a pressing need for innovation and efficiency, pointing towards the potential of low/no-code solutions in modernizing fund management technology.

So what does low cod/no code mean (LCNC)? In the bustling world of investment management, LCNC platforms emerge as the game-changer, redefining the essence of agile innovation. Imagine a scenario where developing cutting-edge software solutions doesn’t demand a battalion of coders but rather a single visionary with a clear goal. These platforms are akin to having an expert consultant at your disposal, guiding you through creating complex investment models or client portals with the ease of arranging chess pieces on a board.

Why the pressing need, you ask? The answer lies in the transformative potential to replace time-consuming, error-prone manual processes with automated, efficient workflows. Low-code/no-code technology empowers investment managers to swiftly adapt to market changes, develop customized solutions for risk assessment, portfolio management, and client reporting, without the traditional barriers of software development. To make it sound even more down to earth. No more copy-pasting, downloading, reloading, uploading, and all that jazz. It’s not just about keeping pace; it’s about setting the pace in a competitive landscape, ensuring your firm remains at the forefront of innovation, agility, and strategic foresight.

In this article, we delve into the transformative potential of No/Low code applications within the realm of Fund Management. We chose a few instances of existing off-the-shelf solutions as well as examined some case studies, aiming to demonstrate how these innovative tools can be seamlessly integrated into the sector’s operational framework.

Unqork

Exploring the area of low-code/no-code (LCNC) technology in the context of fund management, let’s talk about how these cutting-edge wonders can transform the way funds function. Picture this: traditional, clunky legacy systems that feel like they belong in a museum, contrasted sharply with sleek, cloud-based solutions that are as easy to integrate as snapping your fingers. Imagine the sheer relief of fund managers as they transition from endless manual data entry to focusing on what really matters—strategic decisions that propel performance skyward. No more dreading major overhauls; it’s all about embracing change without the headache. It’s not just an upgrade; it’s a game-changer.

Velox

Let’s explore the wealth of advantages that low-code platforms bring to fund management.  Imagine slashing costs without compromising quality, where every dollar saved is a dollar invested in future growth. With low-code, efficiency isn’t just a buzzword; it’s the new normal. Tasks that once took hours now unfold in minutes, freeing up teams to focus on strategy and innovation. And speed? It’s like upgrading from a bicycle to a jet. Low-code platforms mean you’re not just keeping up; you’re setting the pace, turning weeks of development into days, and swiftly adapting to market changes. This isn’t just about doing things faster; it’s about doing them smarter, with the agility to meet tomorrow’s challenges head-on. Therefore the main benefits can be seen as following: 

MICology

Cost Savings Galore: Imagine keeping more of that precious capital in your pocket. Low-code platforms cut down on the need for expensive developers and lengthy project timelines, meaning more money to invest directly into your fund’s growth.

Efficiency Like Never Before: Picture your operations running smoother than a well-oiled machine. With low-code, tasks that once took days can now be completed in hours, freeing up your team to focus on what they do best—making strategic decisions.

Speed to Market at Lightning Pace: In the race of fund management, low-code gives you jetpacks. Launch new products or adapt to market changes faster than ever before, keeping you one step ahead of the competition.

Enhanced Flexibility: Quickly adapt to regulatory changes and market shifts.

Collaboration Boost: Facilitates better teamwork across departments by simplifying the tech barrier.

Risk Reduction: Lower chances of errors in manual processes, enhancing compliance and data integrity.

Customer Experience Improvement: Enables the creation of client-facing applications for better engagement and service.

Scalability: Easily scales with your business growth without significant additional costs.

Pega

Gartner’s forecast reveals a fascinating narrative in the world of finance, particularly within the hedge fund sector, where the adoption of low-code/no-code technologies is not just a trend, but a strategic revolution. Amidst the backdrop of remote work’s ascent, spurred by the global pandemic, these technologies have emerged as the unsung heroes, offering a lifeline to funds grappling with the dual challenges of rapid digital transformation and the imperative for cost optimization. The surge to a $13.8 billion market in 2021 is a testament to their pivotal role in not just maintaining operations but propelling them forward. Hedge funds, traditionally encumbered by legacy systems, find in low-code/no-code a beacon of hope—a means to leapfrog to modernity without the trepidation of major overhaul projects. These platforms, with their promise of cloud-based agility and ease of integration, offer a pragmatic pathway to innovation, enabling funds to swiftly adapt to market changes, streamline processes, and focus talent on strategic imperatives rather than mundane, manual tasks. 

Morgan Lewis, a leading global law firm, harnessed the power of OutSystems, a cutting-edge low-code platform, to redefine their client services and internal workflows. This strategic integration facilitated the rapid development and deployment of innovative applications, automating previously manual tasks and significantly improving operational efficiency. Through the adoption of this low-code technology, Morgan Lewis not only streamlined processes across their worldwide offices but also set a new standard for innovation in the legal industry, showcasing the substantial benefits of low-code platforms in enhancing service delivery and operational agility.

ZACD Investments Pte. Ltd., by harnessing the power of the Stragiliti low-code platform, revolutionized its fund management operations through the creation of an investor portal and native mobile applications in a mere three months. This forward-thinking strategy facilitated the seamless integration of ten years’ worth of investment performance data, granting investors immediate insights into the funds. This initiative highlights the effectiveness and adaptability of low-code platforms in simplifying intricate financial operations, showcasing a tangible application of technology that not only boosts investor involvement and operational transparency in the investment fund domain but also significantly reduces friction and email traffic. This new system has allowed the Fund to save substantial amounts of money and time, while improving the efficiency of the investor relations department.

Imagine stepping into a world where the complexities of financial services are simplified at your fingertips. That’s exactly what Citi achieved, partnering with Genesis Global. They didn’t just create a platform; they revolutionized the loan market’s trading floor. And with Bank of America, they went a step further, crafting an unparalleled data and execution haven for structured credit and collateral markets. This isn’t just about cutting down development times; it’s about embracing a future where efficiency, liquidity, and cost-saving become a reality. 

In a twist of digital finesse, Ares Management harnessed the power of low-code application Alteryx, transforming it into a cornerstone of their operational strategy. The journey began with a serendipitous partnership, unveiling Alteryx‘s potential to reshape their transactional tax team’s workload. The ambition? To intertwine Alteryx‘s level of expertise with their existing tech arsenal, aiming for a leap in automation and process efficiency. Because of this, analytics models were developed to simplify complex processes, dashboards to provide insights quickly, and workflows to ensure data is protected with absolute security.

Imagine dipping your toes into the vast ocean of the stock market, armed not with years of Wall Street experience, but with Mage, a user-friendly low-code platform. Here’s where the magic happens: with just a few clicks, you’re wielding machine learning to foresee market movements, turning complex data into your crystal ball. This isn’t just unlocking the door to advanced market analysis—it’s removing the barriers entirely. Now, historical trends aren’t just numbers in a ledger; they’re the keys to unlocking future fortunes, making top-tier investment strategies accessible to anyone with the curiosity to explore them. Through the lens of low-code solutions like Mage, personal finance and investment aren’t just about managing money; they’re about empowering your decisions with insight previously reserved for the financial elite.

Appian

Let’s break it down to the essence, shall we? These low-code/no-code platforms are not just changing the game; they’re entirely rewriting the playbook for hedge funds and investment sectors. Think of it as handing the power back to the people, making what was once a complex web of operations as simple as a few clicks. It’s about opening doors to innovation and growth that were previously hidden behind the daunting walls of traditional coding.

And here’s a piece of friendly advice for those navigating the intricate maze of today’s financial landscape: jump on the low-code/no-code bandwagon and let it drive your transformation. These tools are your secret weapons, enabling you to tear down those old barriers, make the most of your data, and dance through the market’s demands with grace. As we’ve seen, leveraging these platforms wisely can place you leaps and bounds ahead of the competition, making them indispensable in your arsenal.

While diving into the world of low-code solutions, it’s a bit like setting sail on uncharted waters. You might face a storm or two—like the resistance from those who cling to the familiar shores of traditional coding, or navigating the complex seas of integration with those legacy systems that are like old, stubborn anchors. There’s also the challenge of ensuring that these sleek, new vessels are robust enough to carry the weight of regulatory compliance and security demands. But with a skilled crew and a map that marks these hurdles, charting a course through these challenges is not just possible; it’s the adventure of a lifetime in the quest for innovation.

Low-code/no-code platforms offer significant benefits, such as accelerating development and empowering non-coders to build applications. However, their application within the investment management sector remains limited due to challenges in addressing the complexity of financial operations. These platforms, while facilitating rapid prototyping and development, may not fully meet the nuanced requirements of investment management, highlighting a gap between the ease of use and the need for specialized, complex solutions in this field.

The solution in our view involves embracing true interoperability and utilizing bitemporal data. 

Alteryx

Our approach entails fully adopting systems that can work together smoothly and making use of bitemporal data, which means tracking and analyzing information across two timelines: one for when the data actually happened and another for when it was recorded in the system.

This approach addresses the limitations by ensuring systems can communicate seamlessly and manage data across different timelines. By adopting open architectures and well-defined APIs, investment management firms can achieve the necessary flexibility and control over their operations, navigating complex data landscapes more effectively. This strategy allows for a more sophisticated handling of investment processes, moving beyond the constraints of low-code/no-code to tackle the intricate demands of the financial sector.

Airtable

Recognizing the importance of selecting the right technological solution for your fund management operations cannot be overstated. The landscape of financial technology offers a broad spectrum of off-the-shelf solutions that promise quick deployment and immediate benefits. However, the challenge lies not only in choosing a solution but in choosing one that aligns perfectly with your unique operational needs, strategic goals, and future growth. This process is fraught with potential pitfalls, including investing in technology that may not scale with your business, lacks necessary customizations, or fails to integrate seamlessly with existing systems.

A thorough strategy is necessary for navigating this complicated landscape without incurring unnecessary expenses. A comprehensive review of your present operations, identification of your problems, and a plan for the future are the building blocks. With this background information in hand, you can assess potential technologies based on how well they meet your unique needs and goals, rather than only their features.

Moreover, it’s critical to consider the adaptability of the solution to evolving market conditions and regulatory environments. A common oversight is underestimating the importance of scalability and flexibility, which can lead to significant operational disruptions and additional costs in the long run.

This is where FinTech4Funds comes into play. Our expertise lies in navigating the complexities of financial technology solutions tailored for fund management. Whether you’re in search of an off-the-shelf product that can be quickly implemented to address immediate needs or you’re contemplating a more customized, bespoke solution that is meticulously designed to fit your unique requirements, FinTech4Funds is your partner in this journey.

By leveraging our deep industry knowledge and technological expertise, we can help you avoid common pitfalls associated with selecting and implementing financial technology solutions. To further support fund managers in this endeavor, we regularly share our insights, proprietary research, and comprehensive guidelines through our blog. These resources are designed to empower you with the knowledge needed to make informed decisions. For an in-depth exploration, we invite you to access our free publication: Fund Managers Guide to Asset Management Systems 2024, available on our blog, offering valuable perspectives and strategies tailored for success in the dynamic world of fund management.

Our approach involves a detailed assessment of your specific needs, followed by the identification and vetting of suitable technologies. Whether it’s enhancing operational efficiency, improving investor relations, or ensuring compliance with regulatory standards, FinTech4Funds is equipped to assist you in finding the right solution for your Fund that not only meets your current needs but also positions you for future success.

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