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Hedge funds turn to technology

Date: Monday, September 4, 2006
Author: ZDNET

Increasing exposure and regulation are forcing the hedge funds industry''s participants globally to look to technology to ease some of their pain points, says a new report 'Securities Processing in Hedge Funds' by independent market analyst Datamonitor (DTM.L).

It predicts global hedge funds'' investment in IT will reach $3.3 billion by 2009. The report investigates the technologies being demanded by this industry to cope with new market developments and reveals that opportunities for technology vendors are not restricted to the global hedge funds industry alone but also to service providers such as prime brokers and fund administrators.

Says Nii Barnor, Financials Services Technology Analyst with Datamonitor and author of the study, "The evolution of the hedge fund sector is somewhat inevitable. Hedge funds globally will look to use technology to improve execution capability in the front office as they seek competitive advantage. In addition, service providers need to raise the bar too by offering enhanced reporting functionality and superior connectivity to clients."

Datamonitor expects the global market to reach approximately $1.9 trillion in assets under management by 2009.