Automated asset allocation is on its way for the funds industry as Euroclear, a major provider of market infrastructure, teams up with a financial technology firm.
Euroclear has joined forces with Quantessence, a UK-based financial technology company, to deliver a platform to deliver predefined asset allocation algorithms for distributors and asset managers.
The firms say this will help the industry to lower capital costs and increase trust.
Partly making this venture possible for Euroclear is that it already automates the selection and movement of securities for parties involved in collateral management.
Jo Van de Velde, global head of product management and innovation at Euroclear, said: “Today, we already automate the selection and movement of over €1 trillion of fixed income securities and equities for collateral management purposes through our triparty platform. With Euroclear Quantessence, we will extend our scope of automated selection and movement to the funds industry.”
The platform first offering is an algo-driven risk management strategy called iCPPI that runs pre-agreed asset allocation algorithms to provide capital protection for individuals’ fund portfolios.
©2017 funds europe
