How often does your portfolio operations or investment team have to manually normalize investment data? Most ultra-high net worth investors and family offices we work with say “too often.”
The challenge is that multi-asset class portfolios by definition require data aggregation and reconciliation across multiple data sources. Even public asset data could be coming from multiple custodians or banks. Let’s say you own an asset across three custodians. Each custodian may have its own unique identifier for the asset. Many fintech systems claim they can flag and normalize the data, to ensure your portfolio reports show that you own one security across three custodians.
Alarmingly, this is not always the case. We frequently hear from UHNW wealth owners, family offices and private banks struggling to accurately report on assets held across multiple custodial systems. Achieving a holistic, accurate view of UHNW portfolio performance becomes cumbersome and time consuming when operations or investment teams must manually intervene to normalize data, often resorting to spreadsheets.
To learn how to address this issue, watch our latest UHNW Portfolio Management Pet Peeve of the Day video: “Data Normalization Errors.”
Our UHNW Portfolio Management Pet Peeve of the Day video series touches on some of the most common pet peeves we hear from UHNW investors, family offices and private banks. We offer tips on how to improve your portfolio management technology and process framework to set a new, better standard for portfolio data accuracy. If you’re interested in seeing more from the series, watch our other videos: “IRR Calculations,” “The Trade Date vs. Settlement Date Dilemma,” “Lack of Investment Reconciliation,” “Private Investments on Custodial Platforms,” “Manual Intervention to Fix Inaccuracies,” and “Inaccurate Performance Calculations.”