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Modern Data + AI Integration:Strategies and Architectures

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Overcoming Data Integration Challenges in Asset Management with Nexla

Asset management companies specialize in managing and investing assets for individuals, businesses, and institutional investors. Their primary goal is to maximize returns while minimizing risks. Prominent asset managers include BlackRock, Vanguard, Fidelity, State Street, and JPMC. These firms engage in various activities such as portfolio management, investment research, asset allocation, risk management, performance reporting, client servicing, compliance, and fund management. However, the industry faces significant data integration challenges that can hinder operational efficiency and decision-making. 

Key Activities in Asset Management

  1. Portfolio Management: Developing and managing investment portfolios based on clients’ financial goals, risk tolerance, and time horizon.
  2. Investment Research and Analysis: Conducting extensive research to make informed investment decisions.
  3. Asset Allocation: Diversifying investments to optimize returns and manage risks.
  4. Risk Management: Employing techniques to mitigate potential losses.
  5. Performance Reporting: Providing clients with regular updates on their investment portfolios.
  6. Client Servicing: Offering personalized investment advice and support.
  7. Compliance and Regulation: Ensuring adherence to industry regulations.
  8. Fund Management: Managing mutual funds, ETFs, and other investment vehicles.

Typical Data Processes

Asset management involves handling diverse data from various sources, including market data providers (Bloomberg, Thomson Reuters), fundamentals data providers (MSCI, S&P Global), public data sources (financial statements, regulatory filings), economic data (GDP growth, inflation rates), private/subscribed data sources (research reports, alternative data), and news sources.

Data Integration Challenges in Financial Services

  1. Data Variety: Managing different formats and protocols like SWIFT, BAI, CSV, XML, and Parquet.
  2. Legacy Systems: Integrating with outdated systems that still operate in production environments.
  3. Data Timeliness: Ensuring real-time data processing to avoid financial losses.
  4. Data Fragmentation: Consolidating fragmented data streams to provide a unified view.

Nexla’s Solution

Nexla addresses these challenges with its robust data integration platform, enabling asset management firms to streamline their data operations. Here’s how Nexla helps:

  1. Handling Diverse Data Formats: Nexla supports 30+ data formats, including custom parsers, ensuring seamless integration across all systems.
  2. Bridging Legacy Systems: Nexla bridges the gap between old and new systems, maintaining operational efficiency during transitions.
  3. Real-Time Data Processing: Nexla ensures rapid data delivery, minimizing risks and maximizing profits.
  4. Consolidating Data Streams: Nexla unifies fragmented data streams, enhancing decision-making and operational efficiency.

Nexla Streamlines Data Integration for a Leading Asset Management Company to Scale Data Operations and GenAI

A leading asset management innovator faced scalability issues with data integration from diverse sources, managing frequent schema changes, and aggregating heterogeneous data for downstream use. As operations expanded, manual processes became unsustainable.

Solution: Nexla provided universal connectors for seamless file and API integration, active metadata intelligence for detecting schema changes, built-in validation and monitoring for data quality assurance, and data packaged into consumable formats. Self-service capabilities allowed for retrieval-augmented generation workflows in Generative AI solutions.

Results

  • Created pipelines connecting 250 financial data providers with minimal manual effort
  • Managed 2400 daily active data flows in one tool
  • Scaled the data engineering team’s efficiency and reduced ticket backlogs
  • Streamlined real-time data integration
  • Optimized decision-making with up-to-date insights
  • Facilitated advanced Generative AI applications for regulatory and operational needs

Read full case study here

Nexla’s data integration platform empowers asset management firms to overcome data variety, legacy systems, timeliness, and fragmentation challenges. By streamlining data processes, Nexla enhances operational efficiency and decision-making, ensuring that firms like Clearwater Analytics can continue to innovate and deliver exceptional services to their clients. For more information, visit Nexla for Asset Management.

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