Surging inflation and interest rates compounded by banking turmoil, intense competition and geopolitical upheaval have taken their toll on the global asset management industry. There were some signs of recovery in 2023, with total assets under management (AUM) rising 12% year-over-year to nearly $120 trillion. Industry revenues increased just marginally, however, while rising costs resulted in a profit decline.
To maintain resiliency and create a competitive advantage, asset management firms are looking for robust workflow solutions to generate and test winning strategies and uncover unique sources of alpha. They also want to control costs by efficiently communicating portfolio performance using client-ready reports.
This global asset management firm has been defying industry trends and posting strong growth in AUM and profits over the past several years. However, members of the investment team were concerned about their ability to continue at this pace. They wanted to invest further in capabilities to enhance how they evaluated and communicated the drivers of their portfolio performance, especially as many other firms in the industry are adopting advanced tools to try and gain an edge.
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The asset management business is highly competitive, and market participants need to continually adopt state-of-the-art capabilities to explain their investment strategies and highlight their performance relative to others.
Pain Points
Members of the investment team were focused on maintaining the firm's strong historical growth. In particular, they wanted to find a trusted provider that could help enhance their performance reporting that is so essential for business retention and acquisition. To support this, they needed access to:
- Comprehensive fundamental data to assess the financial strength of companies in their portfolio.
- Estimates to better understand where company financials may be headed.
- Portfolio performance and risk analysis capabilities on a historical or intraday basis.
- Benchmarks to compare performance relative to peer funds.
- Insights on the environmental, social and governance (ESG) stance of companies as this area continues to grow in importance.
- An extensive library of charts and tables to build highly visual reports.
- Easy-to-use tools to work quickly and efficiently.
The team was familiar with S&P Global Market Intelligence ("Market Intelligence") and reached out to learn more about the firm's capabilities.
The Solution
Market Intelligence specialists described an array of datasets available on the powerful S&P Capital IQ Pro platform and mentioned that the company had won numerous awards, including WatersTechnolgy's award for best research provider and best performance measurement and attribution system provider.[1] They then described Portfolio Analytics, a robust feature to the platform that supports portfolio performance and risk analysis. Together these capabilities would enable the investment team to:
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Easily assess the financials of public companies |
The Premium Financials Dataset provides standardized data for 5K+ financial, supplemental and industry-specific data items for 150K+ companies globally, including 95K+ active and inactive companies across multiple industries.[2] Data is available at numerous frequencies and point-in-time representations of a financial period include press releases, original filings and restatements. |
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See where the market thinks companies are headed |
The S&P Capital IQ Estimates Dataset provides comprehensive global estimates based on projections, models, analysis and research. It can be used to evaluate earnings estimates to select stocks and manage investment performance, track the direction and magnitude of upgrades and downgrades and more. Available as Global, International or North American company packages, it includes:
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Round out stories with complementary insights |
The Transactions Dataset provides the entire lifecycle of primary and secondary market business transactions, across public offerings, private placements, M&As, buybacks/repurchases, corporate restructuring, bankruptcies, spin-offs and split-offs. This includes 2M+ high-quality transactions across the globe collected within 24 hours of disclosure. The Transcripts Dataset covers earnings, M&A activity, company conference calls and special calls. The Key Developments Dataset provides structured summaries of material news and events. With deep history back to 2003, key features include the collection of 2K+ key developments daily for dividends, M&As, buybacks, public offerings, management changes, debt defaults, dividend cancellations and regulatory agency inquiries. |
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Integrate sustainability data and assessments |
The Trucost Environmental Dataset enables users to run a baseline carbon footprint and identify holdings with exposures to fossil fuel activities. The data measures environmental impact across key dimensions for over 20,000 companies, providing details on:
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Streamline portfolio analysis, monitoring and reporting |
Portfolio Analytics available via S&P Capital IQ Pro transforms comprehensive fundamental and industry leading data into powerful portfolio intelligence. Users can:
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Figure 1: Sample Portfolio Analytics View
Source: S&P Global Market Intelligence. For Illustrative purposes only.
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Save time with productivity-enhancing tools on S&P Capital IQ Pro |
A smart screener enables users to instantly find information across companies, news, documents, research, transcripts and investor presentations. Document Viewer incorporates AI-based searches to speed up the discovery process for text-based insights across filings and transcripts. A suite of office tools, including an Excel Plug-in, seamlessly powers proprietary models and streamlines presentations. Users can access a library of hundreds of ready-to-use models and templates, integrate data from Excel to PowerPoint or Word with fewer errors and refresh formulas in Excel with just one click. Market Intelligence specialists are located around the world and are available for training sessions and to provide ongoing support as clients utilize different solutions and the S&P Capital IQ Pro platform. |
Key Benefits
Members of the investment team were very impressed with the ease of use and flexibility of Portfolio Analytics for conducting performance and risk analysis leveraging best-in-class traditional data, such as S&P Capital IQ Premium Financials, Estimates and market data. They also appreciated the many discussions they had with Market Intelligence specialists and the high level of support they would receive post sale to ingest data, build reports and dashboards and train personnel to get the most out of the solution sets. In addition, they liked Market Intelligence's approach to pricing and their ability to have a firm-wide license to add users as needed.
The investment team subscribed to the offering and are now able to:
- Ingest client portfolios on an ad-hoc basis or directly from their custodian and accounting system, which can then be compared to an array of index benchmarks and mutual fund and ETF holdings.
- Determine how historical top-down allocations or bottom-up selection decisions impacted their portfolio’s relative performance versus benchmarks.
- Identify hidden risk exposures to currencies, regions, industries and styles using Market Intelligence’s proprietary risk models.
- Perform attribution analysis alongside critical assessments of carbon footprints and peer analysis of industry-specific obligations associated with addressing environmental regulations or physical risks.
- Build highly visual reports through an adaptable and intuitive user interface, combined with powerful user-defined custom functions to support ad-hoc or scheduled batch reporting.
- See important information immediately with their customized dashboards.
The team is now investigating other data delivery options, including via a feed with XpressfeedTM and via the cloud with Snowflake.
[1] "Best research provider—S&P Global Market Intelligence”, 2022: www.waterstechnology.com/awards-rankings/7947476/imd-ird-awards-2022-best-research-provider-sp-global-market-intelligence; "Best performance measurement and attribution system provider, 2022, https://www.waterstechnology.com/awards-rankings/7948731/waters-rankings-2022-best-performance-measurement-and-attribution-system-provider-sp-global-market-intelligence.
[2] Coverage as of January 2024.