Investment Research Outsourcing for Asset Managers

Normal rules often break down in extreme circumstances. In science, many of the ordinary laws of physics go awry when scientists look at extremely small particles. Similarly, investment management firms, as well as consultants who are guiding the process, may need to modify their approach when evaluating outsourcing strategies for niche, high-end functions close to – or even within – the front office. One crucial front-office function is investment research, and investment research outsourcing (IRO) is a small but rapidly growing industry near the very top of the financial services food chain. The term covers a broad spectrum of functions used by asset managers to support the investment decision process. The key word here is ‘support’ – every investment manager rightly considers the unique insights that go into an investment decision to be their core competence.

 

Author:
Anand Aithal is a Co-founder and Managing Director. An ex-Goldman Sachs MD, he was Head of Goldman Sachs' India Research JV. Anand is an Asia strategist with 11 years of Asia and Europe research experience. His most recent role was that of Asia equity strategist and business leader for all Singapore-based research. He holds an MA in Economics from Cambridge University.