The finance industry is under tremendous pressure because of the rising operational complexity and increasing regulatory requirements. In such a scenario, the industry is witnessing a greater focus on data accuracy and operational efficiency to generate higher alpha. Spun out of D. E. Shaw Group, a global investment and technology development firm, Arcesium is a company with a team that has a long history of dealing with such complexities across a broad range of asset classes. Leveraging its experience, Arcesium—comprising hedge funds experts and technologists—has built a cloud-based solution suite that caters to the holistic needs of hedge fund managers and asset managers. The solution suite not only enables clients to handle market complexities at scale but also helps them improve their operational efficiency and reduce the resource overhead while their employees focus on value-added functions for greater outcomes.
Typically, funds find it daunting to manage their vast data that is constantly getting updated. The New York-based technology and professional services firm Arcesium ensures its clients have seamless access to all of their data to execute their operations. The company offers a reconciliation solution that compares millions of data records across any two datasets and produces key metrics and metadata which are available to the clients in real-time. Unlike other out-of-the-box reconciliation tools that demand users to configure the entire setup from the beginning, Arcesium’s solution enables large hedge funds and administrators with greater flexibility in managing their operations seamlessly through pre-configured standard reconciliation components as well as the capability to set up a new reconciliation across any two data sets. In addition, a customizable, robust match key is available across all reconciliation data sets and products, including listed instruments and the complex over-the-counters (OTCs).
Arcesium’s reconciliation solution integrates with the company’s existing technology stack, enabling users with a wider range of benefits. To elaborate, the Financial Data Stack offering can be used to capture and store data from any internal or third-party system, market data vendor, or counterparty. The users of this solution can organize, interrogate, and validate all data sets to create a single source of truth for the entire organization. Besides, Arcesium’s Treasury solution handles collateral, financial interest, margin replication, and helps users in coding the agreements. Clients can either deploy Arcesium’s solution suite as a set of individual products or as a fully integrated platform.
“As part of our managed services, we cater to the holistic connectivity needs of our clients, including counterparties, brokers, custodians, and fund administrators,” says Alex Dobson, SVP of Arcesium. “To integrate with the clients, we have a wide variety of options, including a robust API library and flat files.” In addition, the company allows clients to maintain granular control over their data through secure permissions for read and write access.
Arcesium takes a consultative approach to client onboarding where it understands their problems and zeroes in on the right solution within its suite to address the situation. Arcesium’s collaboration with a company stands as a testimony to its ability to provide an agile reconciliation solution. The client previously had 15,000 cash breaks daily. Using Arcesium’s solution and expertise, the client could reduce open breaks by 80 percent, which improved the overall outcomes.
With a strong ambition to expand across the market segments, Arcesium will continue to invest in machine learning in reconciliation as well as the broader product offering that will add significant operational efficiency.
Arcesium’s Alex Dobson was interviewed for Capital Markets CIO Outlook’s Reconciliation Special in 2019 after Arcesium was named one of the Top 10 Reconciliation Platform Solution Providers for 2019. The Reconciliation Special was published in December 2019.