Eduardo Gramuglia, country head of State Street Luxembourg, outlines how the firm’s technology enables better performance and outcomes at every stage of the investment lifecycle
As a global organisation, we know we are stronger together. This year, that ethos feels more important than ever. It is these values that will serve us in the long run.
We have a proud history of helping our clients achieve better outcomes for the world’s investors. As Covid-19 continues to shape the global markets, we have maintained close relationships with our clients to provide the best possible support.
In a quickly changing industry where the traditional custody model continues to evolve, we have been at the vanguard of technology innovation with the development of State Street AlphaSM. Powering real-time data and intelligence, Alpha is the first fully open and integrated front-to-back investment servicing platform from a single provider that supports asset and wealth managers across the investment lifecycle.
Putting our clients’ needs front and centre
Decades of experience servicing asset managers and asset owners has given us a front-row seat to the challenges and pressures facing the industry.
Our clients continuously grapple with volatile markets, product rationalisation, shifting investor requirements, new financial regulations, shrinking margins and the rapid pace of technology transformation. They also want continuous coverage and operational resiliency that will help protect them in times of uncertainty. Collaborating with our clients, we went to work on creating a platform that extends beyond our traditional back- and middle-office solutions.
Our front-to-back platform redefines the common definition of “alpha” to mean powering better performance and outcomes. The platform can support businesses across their entire investment process, automating workflows and streamlining operations, giving asset managers faster and deeper insights into portfolio construction. With data as a central component to buy-side operating models, we incorporated system interoperability as well. Backed by deep enterprise data and transaction management capabilities, our interoperable platform enables clients to integrate and align their preferred systems. Clients have a seamless and operationally efficient process that helps them scale in ways they could not before with fragmented service providers.
With access to liquidity, insights and infrastructure, clients benefit from the comprehensive services needed to transform and grow their business. In the current volatile market environment, enabling business transformation and growth is more critical than ever. The ongoing Covid-19 crisis compounds the existing challenges of slower industry growth, expense management, technology and operational resiliency. With this heightened focus on adjusting to a new way of working, managers must acutely focus on core activities and look for a strategic partner who can offer deep expertise and holistic solutions that can help them achieve investment excellence.
At its core, our integrated and interoperable platform seeks to deliver value to our clients in three fundamental ways:
- Our front-to-back platform is integrated to maximise automated trade lifecycle processing, and is now further enhanced for trades originating in Charles River or other State Street trading tools.
- Our software-as-a-service technology model helps reduce operational vulnerabilities in technology risk.
- Trade data validation rules are built into the Charles River Order Management System to catch trade processing issues before they occur, optimising straight-through-processing outcomes.
- Harmonised reference data from the front and middle office through to settlement is designed to reduce manual and time-consuming operations.
- Our services cover several major markets and asset classes, providing a strong operational foundation to help clients expand into new strategies and asset markets.
- Standard integration and strategic partnerships with leading industry providers such as data sources, technology providers and counterparties deepen the platform’s central value.
Our goal is to encourage client innovation and choice. We are excited to continue the partnership with our clients and the many investment providers who power innovation in financial services.
Meeting investors’ data challenges
Data is a critical component of the investment decision-making process. But fragmented, siloed approaches to data management produce redundant and sometimes conflicting representations of data. A data platform with frictionless integration to the front office can help reduce the cost and risk associated with these complexities. This is where our Alpha Data Platform comes in.
- Simplified data management – By consolidating data sources and systems onto one platform, clients benefit from fewer manual reconciliations, an increase in data timeliness and accuracy, and greater collaboration across their organisations.
- Faster, more efficient investment decision-making Frictionless access to the information clients need helps them take action on that data quickly. Our platform allows institutions to incorporate data from their own systems and preferred providers, making all of their information available across the investment lifecycle in near real time.
- Increased focus on innovation – Less time spent managing data means more time spent on the business activities that make a difference to investors: generating enhanced returns and developing new investment products.
Key data platform capabilities
The Alpha Data Platform leverages Microsoft® Azure and Snowflake® to provide a centralised data management solution that aligns with the client’s environment, delivers data in near real-time and integrates with third parties.
The platform provides full transparency into data availability, definitions, usage and lineage. It also uses cloud-native technology with the scale and flexibility to meet the demands of today’s shifting markets, while allowing for data delivery directly via the Charles River cloud or a hybrid environment. The extensible data model facilitates data sharing across client and marketplace ecosystems, with a complete framework for integrating third-party or client-specific data sets.
Furthermore, the Snowflake® Data Marketplace expands access to data sources and allows institutional investors to uncover unique insights. Simplified data integration helps reduce integration costs and speeds time to market.
New strategic partnerships
In January, we were delighted to announced that we entered into a multi-year service agreement with Vontobel Asset Management. The partnership will include front-office technology, investment operation services, Alpha Data Services and liquidity risk solutions.
For Vontobel, it creates additional growth capacity while building out investment service excellence for its investment boutiques that actively manage assets for the clients of the investment house globally.
Using State Street Alpha, Vontobel will have access to a robust, high-quality and scalable operating model that will provide best-in-class services to their portfolio managers and supporting functions. It will also help improve servicing and onboarding of their clients as a result of expanded connectivity with custodians and brokers.
Our understanding of how effective data management can help reveal new insights will continue to drive innovation. Business in a post-pandemic world will be defined by not only creativity and resilience, but by efficiency. Consolidating operations into a single platform and eliminating redundant systems will allow institutional investors to invest in their core capabilities, giving them the best chance of success.
About the author
Eduardo Gramuglia Pallavicino is a Senior Vice President and country head of State Street in Luxembourg. He is the branch manager of State Street Bank International GmbH, Luxembourg Branch, and is responsible for all activities of State Street Corporation in Luxembourg. In his role, Eduardo leads and manages the branch in compliance with applicable laws and regulation, according to strategic and business objectives, risk appetite, compliance programmes, and values of State Street Bank International GmbH in the wider context of the State Street Corporation. Previously, Eduardo held several senior management roles at ABN Amro Mellon and Brown Brothers Harriman in Luxembourg and the UK. Eduardo has more than 20 years of experience in the asset servicing and capital markets industry.