Top Concerns of Fund Allocators Revealed in New Dynamo Survey

Mar 3 2016 | 9:13pm ET

Poor transparency, lack of reporting standards and disparate technology were cited as the biggest concerns among fund allocators, according to a new survey by alternative industry software specialist Dynamo Software.

The research focused on how general partners and limited partners exchange information, according to the company. The lack of a comprehensive research and information platform for manager due diligence, monitoring and reporting stands out as the biggest trouble spot. 

Dynamo’s 2016 Institutional Investor Survey and the resulting paper highlighted the need for not only better clarity and transparency from alternative asset managers but also more robust and integrated technologies to manage massive amounts of information, noted the firm.

“It’s clear from the survey that many allocators do not have the right tools to make important investment and portfolio management decisions,” said Krassen Draganov, CEO of Dynamo Software, in a statement. “The need to marry both the quantitative and the qualitative is paramount to running a successful multi-manager program.” 

Key findings from the survey, which polled 35 asset allocators, include:

  • 94% of investors have asked their fund managers for information above and beyond regular communication.
  • Almost 60% of investors classified the challenge of managing fund communication as either Difficult or Very Difficult
  • The need to use multiple systems for portfolio management and continued reliance on manual data entry are two significant pain points for investors.
  • Investors rate their fund managers’ ability to articulate their investment strategy much higher than their ability to differentiate or describe their “edge”

A copy of the whitepaper can be requested here

Dynamo Software, formerly known as Netage Solutions, has provided industry-specific fund management and portfolio management software for the alternative assets industry since 1998. Its products are in use by more than 350 clients, including private equity and venture capital funds, real estate investment firms, hedge funds, funds of funds, prime brokers, institutional investors, and family offices, managing an aggregate total of more than $1 trillion in assets.

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