12.20.2011
By Terry Flanagan

Fund Administrators Do Heavy IT Lifting

Implementation process involves building from ground up.

For fund administrators, the process f building a solution usually entails starting from scratch with each customer, understanding their requirements and applying best-of-breed technology.

Butterfield Fulcrum, for example, provides a full service fund administration offering including front, middle and back office solutions to hedge funds, fund of funds, managed accounts, family offices, and private equity funds.

With such a diverse clientele, and given the depth of integration required, it’s not surprising that Butterfield Fulcrum must build each implementation from the ground up.

“All of our large clients, fund managers with complex structures, and trading strategies require bespoke solutions designed to meet their specific requirements,”  Tim Calveley, principal shareholder at Butterfield Fulcrum Group, told Markets Media. “Smaller funds will require tailored solutions depending on the strategy.”

Red Kite, one of the world’s leading metals-focused fund groups, has selected Butterfield Fulcrum as its fund administrator.

After a detailed analysis of Red Kite’s specific needs, Butterfield Fulcrum designed a customized solution to answer the client’s requirements. Teams from both Red Kite and Butterfield Fulcrum worked together to develop a unique bespoke administration process.

The appointment confirms Butterfield Fulcrum’s commitment to providing customized administration services to asset managers with some of the most complex commodity trading strategies, asset classes and complex fund structures in the alternatives sector, the company said.

Founded in 2004, Red Kite is one of the world’s leading metals-focused fund groups. Within its trading funds, it manages futures and arbitrage positions combined with a significant physical metals merchanting operation. The group also has a mine finance fund, providing capital to mining companies and generating yield and physical marketing returns.

Due to increasing demands from investors for transparency, accountability and best practices, fund managers require an independent fund administrator to help them achieve these goals.

Fund managers will find it extremely difficult to raise institutional capital (other than friends and family) without such best practices.  In addition, the compliance burden for funds is rapidly increasing e.g., (FATCA, Form PF) and the need for an administrator to assist in these areas is creating more dependence on from fund managers on their administrator.

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