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Shoreline Innovation Forum – Event Summary

On February 27th, Shoreline held its inaugural Innovation Forum at the Westin Melbourne. As the title suggests, this event was focused on showcasing cutting edge front and middle office solutions for the investment management industry. On the day, we witnessed seven thought-provoking sessions, each offering valuable insights. In attendance were over fifty senior investment, technology and management professionals from a range of leading superannuation funds, asset managers, and sovereign wealth funds.

Preparations for this event had commenced in October last year, with Shoreline inviting thirty different technology vendors who serve the APAC region to pitch their most innovative ideas with the brief of demonstrating an innovative solution to a pressing buy-side industry problem. Each vendor submitted a one-page brief outlining the solution, the industry problem the solution addresses, and some specifics of what they will demonstrate. The response to our invite was quite overwhelming from the vendor community, receiving over 30 entries. Over several weeks, our leadership team assessed the entries to arrive at the final five. The selection criteria was primarily driven by three parameters:

  • Innovative nature of the solution
  • Materiality / commonality of the industry problem addressed by the solution
  • Entertainment value of the planned solution / system demonstration

The event kicked-off at 12:30 pm. By then, all guests had settled at their lunch tables. Our Associate Director, Dale Rowley essayed the role of perfect anchor on this occasion. He explained the agenda and the format of the conference to the presenters and the audience and also gave a sneak peek of the forthcoming sessions. Each vendor was assigned a thirty minutes slot to present their idea. They were also requested to restrict the length of their corporate pitch to not more than five minutes and five minutes were additionally earmarked for audience questions towards the end of each presentation.

Below is a list of key takeaways from all seven sessions delivered at the Innovation Forum.

  1. Execution as a service? Exploring the future of buy side execution vs outsourced services – Barneby Edmunds, Shoreline

Barnaby Edmunds, who heads the front office practice area at Shoreline, kicked off the first session. The idea of having execution as an outsourced service is being widely debated across the globe by many asset managers. The facts presented in his session were quite thought provoking. He begun with a brief tour of the current landscape in trade execution and then moved on to explain the fundamental drivers which are catalysing the demand for outsourcing. Then, he covered the types of execution as a service model and discussed the merits and demerits of pursuing an outsourcing path for an asset manager. Providing local context on the issue, his views on the future of buy side execution resonated well with the audience.

  1. Alexa, what’s the performance of my fund – a conversation with the data – BNY Mellon Data & Analytics Solution

Graeme Roberts, a Solutions Specialist at BNY Mellon Data and Analytics team caught the audience’s attention with his work on the amalgamation of AI with real time BI. The open architecture-ecosystem solution of investment performance measurement, investment analytics and automated commentary using AI in the form of real-time interaction with the data sets via NLG was commendable. The Alexa demonstration at the end of his presentation, where Alexa called out performance and attribution results of a portfolio at total, sector and security level on-demand was a treat to watch for everyone.

  1. The Future of Portfolio Construction: Your Intelligence. Your Story. Your Platform – Jacobi Strategies

Tony Mackenzie, one of the co-founders of Jacobi Strategies, took centre-stage and raised the classic conundrum related to the growing number of investment applications at many fund houses. This passive growth in platforms has complicated and cluttered the investment workflow and pushed asset managers to an unfavorable spot where technology has started dictating terms to investment decision making. Tony outlined how Jacobi, an open architecture multi asset portfolio construction platform, solves this problem by simplifying the portfolio construction process with scenario and factor analysis and allows clients to build high impact dashboards seamlessly. He also highlighted how this solution incorporates forward asset projections, performs stress tests under different regimes, and can conduct “step” optimizations to find the optimal allocation – all conducted interactively and live.

  1. Improving Investment Decisions with Automated Machine Learning – FactSet

Ian Hissey, a Regional Director at FactSet, kicked-off his session with some hard hitting quotes from Elon Musk highlighting the perils of ignoring AI by buy-side firms. To mitigate this threat, he initially pitched the idea of building in-house capabilities for AI & ML by acquiring domain expertise, new programming skills complemented with the in-depth knowledge of math & statistics. He then pivoted to showcase FactSet’s new offerings powered by DataRobot to improve investment decision-making with automated ML via three case studies. The audience thoroughly enjoyed witnessing a first-hand view of the applications of AI & ML in the alpha generation process in the listed equities space.

  1. Are our Operating Models ready for market disruption? – Bruce Russell, Shoreline

Bruce Russell, co-founder and Executive Director at Shoreline, gave a high impact presentation on the future operating models of buy-side firms amidst global macro uncertainties like QE, Trade Protectionism, Climate change and the spread of global pandemics. Bruce first gave an overview of some of the structural pitfalls facing investment organisations developing an operating model and then provided some practical steps in order to overcome these pitfalls and successfully implement an operating model. He then emphasised the role of service providers in future investment management operating models, and advocated the need to reassess existing revenue drivers and investment strategies of investment organisation in order to retain a competitive edge in the market.

  1. Create, Collaborate, Conquer! Next generation research management – MackeyRMS

Will Keuper, a VP at MackeyRMS took up a fascinating, yet overlooked aspect of buy-side investment research, i.e. aggregation of research content. The institutional investing world has witnessed a colossal explosion in research related information from conventional financial statements and annual reports to new alternative forms of big data. All this content is scattered across organisation in various formats like excel spreadsheets, emails, pdfs, powerpoints, news clips and stories, text messages etc. These diverse forms of research content often causes inefficiencies and delays in recalling investment ideas at short notice, and complicates organisation’s investment process. Will outlined how MackeyRMS solves the cross-platform content aggregation problem with its proprietary smart tagging and indexing technology that streamlines the flow of research information and supplements alpha-hunting capabilities of portfolio managers.

  1. Rebalancing: bridging the gap between asset allocation strategy and implementation – Matrix IDM

Neil Lotter, co-CEO of Matrix IDM, presented an asset owner-centric approach to portfolio rebalancing. By sharing the frustration of running critical investment policy decisions on complex spreadsheets, he managed to call out the elephant in the asset owner’s room and struck the right chord with the audience. He, then moved on to give a live demonstration of their new product suite used for cash-flow and exposure management, asset allocation and rebalancing, investment and product intelligence, regulatory reporting, compliance and EDM. Neil demonstrated the platform’s interface and configurable workflows which have been designed specifically for asset owners, OCIOs and fund-of-fund managers and are able to cater for a mixture of internal and external mandates, unitised investments and derivative overlays.

The day concluded with networking drinks which allowed the audience to reflect on how they could best prepare and respond to future developments in the investment industry following the day’s illuminating presentations. Shoreline would like to thank each of the vendors who presented on the day and contributed to making the Innovation Forum meaningful and filled with valuable content.

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