Long before we began our love affair with drinking coffee, it is believed that one day, a shepherd in Ethiopia took inspiration from his herd of goats who he had seen eating a curious fruit, and discovered that it delivered a pleasant burst of energy. That red fruit turned out to be the coffee cherry. Impressed, the shepherd took a batch of the curious cherries to a local monk who proceeded to boil them and create a heady brew. From those humble beginnings, the coffee cherry has since attained truly global status, being the most consumed drink in the world, just behind tea.
In our first post on the impact of fund data, the argument was put forward that clean data not only improves sales efficiency but by reducing the amount of noise which arises when having to fix inaccurate data points, it can also lead to greater cost efficiency, leading to lower fund TERs.
But that’s only half the story.
Distributed ledger technology—and more notably Blockchain—has stirred debate on many levels. Asset servicers have yet to tire about explaining the benefits and cost savings it could bring to their industry, while employees at central counterparty clearing houses and central securities depositories question whether their jobs are secure in this new environment.
The theory behind Moore’s Law is that computer processing power doubles every two years. And whilst technology advancements are benefiting global industry at large, within asset management it is beginning to blur the lines with respect to data and the myriad reports that regulators have required within recent years.