the transformation of it and hedge fund operations
Post on 05-Dec-2014
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TheTRANSFORMATIONof IT and Hedge Fund Operations
State of the Industry
• Managing investments is not just about managing investments anymore.
• Hedge funds require sound operations and infrastructure to succeed.
• A variety of industry factors play key roles.
competition for assets
technology innovation
investor expectations
regulatory oversight
Regulations
• Post-Madoff & 2008 Financial Crisis, SEC and FINRA keeping closer eye on financial services industry
• e.g. Dodd-Frank, SEC cybersecurity roundtable last month
regulatory oversight
Competition
• More competition than ever for investment allocations
• Technology powering smaller firms to compete on institutional-level with larger funds
competition for assets
Investors
• Demands for transparency are stronger than ever
• DDQ requests have increased exponentially
• Investors expect sound operations & technology to support investment management
investor expectations
Technology
• Increased focus on managing operational risk
• Emergence of ‚big data‛ trend as firms manage more and more info
• Reliance on mobile devices, BYOD
technology innovation
Technology Shift
5 YEARS AGO
• $200K-500K technology investment
• In-House Comm. Room
TODAY
• OpEx vs. CapEx• Leverage Cloud or
Data Center
Cloud Adoption
74%
90%
87%private cloud
avg. satisfaction level
using cloud services
Source: Cloud Usage Trends Survey, Eze Castle Integration & IDG Research, September 2013
Why Go Cloud?
• Business needs driving cloud deployment:
Easy access to applications; simplified application management
Greater control and predictability of IT costs and budgeting
Reduced complexity and management of IT
Improved disaster recovery/business continuity
Enabling global support of local and remote offices
Reallocating personnel resources
60%
55%
55%
54%
42%
41%
Source: Cloud Usage Trends Survey, Eze Castle Integration & IDG Research, September 2013
The Right Time
Office Relocation New Applications Technology Refresh
• Ideal time to review infrastructure
• Don’t invest in moving outdated technology
• Migrate to cloud prior to relocation
• Easy to add new applications (in hours)
• Long-term planning no more
• Predictable cost structure
• Conduct a cost-feature comparison for on-prem refresh vs. cloud
• With cloud, transition process is simple
Due Diligence
• Institutional investors demanding more transparency than ever
• Due diligence questionnaires evolving/expanding
• ‘Checking the box’ is not enough
• Detailed responses on DR/BCP, security, operations, etc.
INVESTORS
How often are IT policies &
procedures tested? How is data backed up and at what
frequency?
Do you have a written business
continuity plan in place to guide
employees during a disaster?
Have you conducted a
security vulnerability assessment or
penetration test?
DR/BCP
Disaster Recovery
• Infrastructure-centric• Details
implementation/support of recovery infrastructure
• Minimizes & mitigates effects of outages/disasters
• Allows continuation/quick resumption of mission-critical functions
Business Continuity
• People-centric• Concept-centric• Details mission-critical
services, functions & personnel
• Reveals risks• Documents, tests and
educates on steps to return to operations
Disaster Recovery
• A fully managed service that supplies the resources and redundancy to quickly resume and maintain mission-critical functions when faced with outages & disasters.
Managed Disaster Recovery
Features & Benefits to Look For
• No hardware or software purchases necessary• Replication of production virtual machines (VMs)• Remote access to applications (MS Exchange, OMS, SQL, etc.)• Virtualized solution with resource pool• 24x7x365 support• Proactive maintenance and bi-annual testing
Security Practices
• Security = Most frequently vetted topic by investors in 2013.
Principle of Defense in Depth
Principle of Least Privilege
Audit & Logging Systems
Secure User Authentication Protocols
Security Practices
• Employ multiple layers of security simultaneously, e.g.:
• Windows hosts protected by anti-virus software with up-to-date virus definitions
• All Internet and DMZ facing hosts protected by OSSEC host-based intrusion detection
• Limit access to only those who need it• Implement restriction policies
• Access Control• Applications• Data• Inbound/Outbound Internet
Principle of Defense in Depth
Principle of Least Privilege
Security Practices
• Central logging system that records:• All login/logout events• Inbound/outbound connections through
Internet-facing firewalls
Audit & Logging Systems
Secure User Authentication Protocols
• Assign unique domain user IDs to each employee
• Enforce strong passwords• Restrict access to active users and
active user accounts only
Looking Ahead
• Future of cloud services looks certain:
hybrid cloud
private cloud
public cloud
38%
41%
28%
6%
9%
11%
39%
46%
49%
18%
5%
13%
Future Use of Cloud Servicesincrease decrease remain the same not applicable
Source: Cloud Usage Trends Survey, Eze Castle Integration & IDG Research, September 2013
Eze Castle Integration
Awards 2013/2014Founded
Office Locations
Employees
Core Services
1995
Boston, Chicago, Dallas, Hong Kong, London, Los Angeles, Minneapolis, New York, San Francisco, Singapore, Stamford
340
• Strategic IT Consulting• Outsourced IT Solutions• Project Management• Communications• Network Design/Mgmt• Internet Service
• Private Cloud Services• Business Continuity• Disaster Recovery • Storage Solutions• Colocation Services• Message Archiving
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