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title: Asset Managers Favor Modular Systems
description: Asset Managers Favor Modular Systems
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[TRACE Turns 20](https://articles.marketsmedia.com/trace-turns-20)

 01.19.2012

 By Terry Flanagan

 Technology

# Asset Managers Favor Modular Systems

 01.19.2012 By Terry Flanagan

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Firms deploy front-to-back office systems to replace one-off or home-grown products.

 Asset managers are moving away from multiple valuation and accounting systems toward single platforms that can be modularized for different functions.

 This shift is caused by the concurrent trends of moving from multiple platforms to consolidated platforms to reduce complexity, as well as a move from in-house systems to standard off-the-shelf systems.

 “We are seeing an increased shift in asset managers moving from a best-of-breed approach for all system components, to a consolidation of business functions by using a one-stop solution to help reduce operational risk and minimize architectural complexity,” Pierre-Aloïs Koch, business development manager, North America, at Misys, told Markets Media.

 The move from multiple platforms to consolidated platforms reduces the number of interfaces and hence the complexity of operations and attached risks, removing any obstacles for future growth (asset class expansion, new funds, etc.).

 “Firms who have adopted a best-of-breed architecture have noticed that this causes higher bottom-line costs to the firm, in addition to adding to the operational risk of having to manage different, and often complex, systems,” said Koch.

 Strategic Investment Group, an asset allocator with $27.9 billion in assets under management as of September 30, 2011, has selected Sophis VALUE for cross-asset trading and global risk management.

 Sophis VALUE provides Strategic with a single system to oversee its diversified positions with external managers, as well as its direct investments. The asset manager will use Sophis VALUE for front-to-back transaction processing, holistic global risk management and investment accounting.

 “One of the requirements of this project was to deliver scalability to the firm by automating many of their existing processes,” said Koch. “Furthermore, as a result of the system’s integrated approach, data will be centralized in one place, across accounts and asset classes.”

 The cross-asset coverage of Sophis VALUE, along with its out-of-the-box, industry-standard pricing models will allow Strategic to carry out its own independent valuation of all asset classes, including derivatives. In addition, Sophis VALUE’s front-to-back workflow will facilitate efficient post-trade processing of all transactions, Koch said.

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