Background

A Portfolio Manager ("PM") invests in a portfolio of assets on behalf of clients. These portfolios comprise securities (stocks & bonds), mutual funds, private assets and cash. Assets are denominated in multiple currencies.

On a monthly basis, PMs have to update their clients on how their portfolio is performing.

The task of accurately calculating portfolio performance is handled by the PM's back office ("Back Office Team"). This team also calculates the management and performance fees charged to clients.

To complete these tasks, the Back Office Team reconciles data from
the PM's monthly custodian (“Custodian Statements”) with trading data ("Trading CSVs") from a 3rd party portfolio tracking software ("Platform A"). Currency data is also manually extracted from a foreign exchange website.

The PM uses Platform A to enter trading data and generate portfolio-specific analytics. Platform A's data needs to be reconciled with the Custodian Statement, as the latter is considered the "source of truth".

The Problem

A profitable asset management business model is about achieving economies of scale by growing assets under management ("AUM") while keeping operating costs low. Low costs in turn attract more client funds and grows profits.

The workflow below shows how the PM will struggle to keep costs low as AUM grows, because the Back Office Team's tasks are quite manual.

The Solution

Project Sukoshizutsu's MVP is envisioned to improve the Back Office Team's efficiency by automatically doing the following:

1. Extract & store Custodian Statement PDF data

2. Flag out discrepancies (if any) between Custodian Statement data and Trading CSV data

3. Calculate performance and management fees

4. Calculate & store portfolio performance

5. Retrieve & store currency rates

--Ends