Technology has been dramatically changing the world for centuries, with each major wave of advancements bringing a whole new world with it. Technology has also impacted investment management over the decades, although some portfolio managers have been loath to adapt.
However, leading investment managers are continually upgrading their processes by adding new technologies in search of alpha, so no firm can afford to be left behind.
In its “2023 Investment Management Outlook,” the Deloitte Center for Financial Services highlighted ways that technology provides advantages to investment managers who know how to use it. The firm noted that there are multiple stages of digital transformation that range from process improvements to the creation of new operating models.
In investment management, such efforts typically fall somewhere in the middle. Process changes generally occur dramatically through the use of new data sources and analytical capabilities to enable new product development.