Technology’s drift to the cloud has brought big-end-of-town portfolio management systems within reach of boutiques, according to Anthony Quirk, Milford Asset Management managing director.
Quirk said Milford’s deal with US portfolio management software provider, Charles River, which was fully-implemented last week, would not have been possible without the cloud-based option.
“Charles River used to be mainly for the big end of town investment firms – you needed to have many billions under management to make it economic,” he said. “But shifting to a cloud-based system makes [the Charles River software] more feasible for boutique firms of our size to use.”
However, Quirk said the deal with the Burlington, Massachusetts-based Charles River still represented a “significant investment in systems” for Milford.
Milford has more than $3.3 billion under management for private wealth, KiwiSaver and institutional clients.
Over 350 investment firms in 40 plus countries use Charles River, the firm said in last week’s release, covering clients in the “institutional asset and fund management, private wealth, alternative investments, insurance, banking, and pension markets”.
In the statement announcing Milford’s going “live” on the Charles River platform, Quirk said the firm now has “one system that supports the investment management process from start-to-finish, across all asset classes”.
“This improves productivity significantly for our portfolio managers, centralised dealing function, and operations and compliance teams,” he said in the statement.
“With Charles River managing and hosting the solution, we can easily access new capabilities and reduce the time and cost of upgrades.”
Quirk said installing the Charles River system was unrelated to last year’s Financial Markets Authority (FMA) investigation that saw Milford fined $1.5 million and a looming court case for the-now on-leave portfolio manager, Mark Warminger.
“At a board meeting at the end of 2013 [Milford] agreed to do a number of things as part of a structural review – including looking at a new portfolio management system,” he said. “We started the process with Charles River in mid-2014, well before the FMA investigation.”
Following the FMA investigation into alleged market manipulation activities and a PwC compliance audit, Milford agreed to introduce a number of new governance and operational procedures.
“Milford undertakes to complete a further external review following implementation of PwC’s recommendations,” the FMA said in a release last June.
Late in 2014, Milford also appointed Mark Riggall as head of a newly-established central dealing desk with a junior dealer, Sean Harrison, joining Milford last April.
The FMA’s civil case against Warminger is due to be heard in the Auckland High Court on September 26 this year.