Recently The DI Wire spoke with Envision EVP Brian Jones about interval funds and other products challenging firms’ operations. Here are a few key themes and excerpts:
On “where” to support interval funds:
“Fund servicers typically separate operations for traditional funds and alternative funds. Traditional fund operations are usually geared toward processing NSCC networked accounts, omnibus accounts, and check and app business. However, interval funds and other alternative fund products require very different processing and technical solutions. Alternative shops are used to handling hedge funds and other products that require partnership accounting while interval funds are 1099 reportable. Therefore, handling interval funds presents challenges in either shop.”
On operational friction:
“Beyond onboarding, other retail alternative product processing such as capital calls, tender offers, and redemption proration are likely handled with some degree of manual tracking. This is unless the investor recordkeeping technology can truly systematize these processes while maintaining flexibility to accommodate complex products.”
On retail alts investor expectations:
“Retail investors still expect retail experiences. This means they are looking for easy investment capabilities and ubiquitous account access. To successfully attract and retain the retail clients, distributors need to provide the pain-free user experience that the investor segment is accustomed to receiving.”
Read more at The DI Wire: https://thediwire.com/five-questions-for-envision-financial-systems-executive-vice-president-brian-jones/