IBOR Options: Finding the Right Path

As investment management firms have achieved growth by expanding product lines -- including global securities, mutual fund shadow accounts, institutional separate accounts, private wealth and retail accounts, among others -- support infrastructures have become extremely complex and expensive. Requisite additional legal and compliance oversight along with increased trading risk further complicate the necessary support structure. Adopting a single investment book of record, or IBOR, can greatly reduce the effort required to support this complexity.

While this may be true, have you ever wondered what you should look at as an investment manager when considering and comparing available IBOR solutions? In order to find the right path for your firm, I recommend a process that includes self-evaluation, followed by a review of available solutions, and ultimately, an examination of specific IBOR providers.

During self-evaluation, you should first determine your firm’s core competencies, then determine what business model and technology delivery method will best allow you to focus on what you do best. A solution that lets you concentrate on core competencies while aligning costs with success is one that I identify as being “right-sourced.” Gaining perspective on how IBOR should work within your firm’s total business will help lead to a right-sourced solution where technology and service intersect and help solve the business efficiency challenge that so often accompanies expanded product lines.