Many asset managers improve their operating model through the implementation of Aladdin from BlackRock Solutions towards highly integrated investment management processes with sophisticated analytical functions. Apart from the expected challenges to configure the standard software components to the specific needs, special attention should be paid to proper setup of data interfaces with further applications and a solid conversion preparation as well as cut-over management.
Interfaces: Usually considered part of the configuration activities is the setup of standard interface connectivity via FIX or SWIFT with brokers, custodians, fund administrators. But complete integration requires further special inbound and outbound interfaces e.g. to source instrument data, to provide data to data warehouse, reporting systems and – especially in case of asset manager of insurance companies – accounting systems.
Conversion: As BlackRock Aladdin is a transaction-based system, the current instrument positions from legacy or core ledger applications need to be transformed into initial trades. Such data loads require Aladdin specific formats and should therefore be thoroughly designed, implemented and tested during multiple Dry Runs.
Cut-over management: Especially for big asset managers with significant trading volumes, the effective switch of the daily business from the old to the new platform should be properly managed to avoid potential operational issues and losses. This for example includes the preparation of readiness assessments with Go/No-Go decision points as well as a runbook for the various tasks of the switchover, communication and training of employees.
Client benefits
- The switch to a sophisticated platform like BlackRock Aladdin with a high level of system integration improves operational accuracy, increases efficiency and reduces manual processes.
- The sophisticated analytical functions additionally support timely and qualitative investment decisions.
finalix contribution
- Standard software configuration is usually performed by the software vendor and dedicated implementation partners. finalix is specialized to support the interface integration with the surrounding system landscape and to coordinate the conversion and cut-over activities.
- Planning, conception, detailed specification, implementation support, UAT/E2E-Testing, coordination and stakeholder management for inbound and outbound interfaces.
- Conversion file data generation for all required asset classes, orchestration of dry runs (e.g. trade entry / reconciliations) and execution of production conversion.
- Security master data management with related day to day activities.
- Definition of a readiness assessment approach, cut-over concept with related runbook and management of respective phases.
- Specifically for Asset Managers of Insurance Companies:
- Full automation of downstream trade lifecycle into accounting systems like into SAP TRM (primary market, secondary market, OTC – across all major asset classes via trade nuggets) as well as corporate action processing (e.g. cash dividends) and interest payments including all related taxes.
- Daily provision of fixed income lot level book values from the accounting system for the relevant ledgers (e.g IFRS 9, local ledgers).
- Special instrument handling like discounted cash flow valuation of mortgages, including all inbound required interfaces (e.g. cash flows, yield curve or custom features) as well as subsequent downstream provision of daily valuation and distribution.
