INVESTMENT MANAGEMENT: FUNCTIONS
“Portfolio administration is
counterparty risk in credit default swaps as a
serious threat to global fi nancial markets.
But while business might be good, it is
one of the cogs that keep the
challenging. Outsourcing has become the
industry norm, but another important trend has
been the increased use of alternatives and
machine functioning ”
derivatives contracts. Notional amounts of all
categories of over-the-counter (OTC) contracts
rose 15% to US$596 trillion at the end of
December 2007, according to fi gures from the
Bank of International Settlements
Th e expansion of third party hedge fund
administration also continues at a remarkable
pace, says Celent, the research and consulting
TIMOTHY PATENALL, CFA
fi rm. With the hedge fund industry undergoing
seismic shifts however, administrators are faced
Title: Alternative Investment
with a formidable set of business and operational
Administration Manager challenges, according to the fi rm.
Current employer: For one, the hedge fund administrator’s role
Henderson Global Investors
has grown, and includes expanded valuation and
Previous employers: Deutsche Bank
reporting capability. Hedge fund clients also want
University: University of York
more collateral management, risk reporting, and
Degrees: Bachelors in Economics
compliance services.
Professional qualifi cations: CFA
INCREASING DEMAND
According to Celent, administrators are now
What attracted you to this career path?
providing a host of added-value services in the
I enjoy working in a team-oriented environment within
a dynamic sector of the world of fi nance
middle offi ce area, as they are dealing with more
complicated products and strategies. Pension
What are the major challenges you face in your
funds are also demanding increasing transparency,
position?
which raises reporting standards.
Managing increasing numbers of complex OTC
“For industry standards to be met, fund
instruments can be diffi cult. Managing outsourced
administrators are re-visiting their operational
service providers is also a challenge.
infrastructures in terms of technology,
organisation, and staffi ng, as well as geographical
Are there certain skills you would consider useful
footprint. As hedge funds have become more
for your job?
discriminating in their choice of service
It’s crucial to have an ability to understand and
providers, the administrator’s risk management
analyse complex instruments. Excellent
and controls have been propelled into the
communication skills are also extremely useful. spotlight,” says the report.
Some administrators say, however, that extra
How do you think the role you’re in now will change demand for services has put pressure on fees.
over time? Clients do not seem particularly willing to pay
Hopefully the number of products and our assets more for their services, but they do expect a lot
under management will continue to increase. I also more from them. On the other hand, asset
expect to build relationships with and utilise a wider
servicers point out that for the fi rst time ever,
range of brokers and other service providers.
they have been able to lure talent away from
investment banks and asset managers, where
Do you have advice for someone intending to pursue
long term, stable careers look less likely. For
the same career path?
candidates with technology, accounting, legal,
Take every opportunity to gain experience of as wide a
and operations backgrounds, portfolio
range of tasks, positions and products as possible,
administration may off er compelling long-term
particularly early in your career.
opportunities.
Cg
WWW.CFAUK.ORG CAREERS GUIDE 2009 43
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