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Shadow-accounting can help hedge fund managers orchestrate greater returns from operations


By Shankar Iyer CEO, Viteos – Shadow-accounting has moved beyond the simple verification of Net Asset Value (NAV). Outsourcing the in-house accounting function, in part or full, is increasingly recognised as bringing significant value to the business via automation and best industry practices, which may not be in the purvey of internal teams, principally because the shadow provider performs these practices across various managers and funds.

Indeed, scalability in this context can work two ways: not only does shadow-accounting empower fund managers to freely explore new asset classes or investment strategies, and provide operational flexibility, it allows them to work with partners who have developed wide, deep level multi-asset class expertise. The wisdom a shadow accounting partner brings to one client, it brings to all.

Viteos is one such firm, having seen its shadow-accounting business grow from USD21 billion to USD180 billion in client AUM over the last four years.

Even if a trader wants to begin trading a new asset class, the operations team will have to figure out how to start accounting for it in a post-trade capacity. Viteos has the asset class experience, it understands and knows how to deal with it so the scalability issue is immediately overcome.

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