The Global Alternative Investment Automation (GAIA) group has created a new operational messaging framework for alternative investment funds.
Initial tests include orders and reporting, and messages are designed to carry across various messaging infrastructures, using the same ISO 20022 messaging formats used for mutual fund processing.
The GAIA group includes seven alternative fund administrators; Clearstream, DTCC, Euroclear, Idea Group, JP Morgan and Northern Trust. The group is now focusing on finalising the testing phase and promoting the widespread use of messages in the industry, as well as looking in to additional flows that could benefit from automation.
Formed in August 2014, the GAIA group aims to bring automation and best practices to operational flows in the alternative investment industry, which previously relied on manual and inefficient processes.
CEO of Idea Group Bill Gourlay said: “The lack of proper message automation in the alternatives space has been a problem for many years, and has defeated a number of former initiatives. We are delighted that GAIA has successfully found a way of not only meeting this challenge, but of also bringing together traditional and alternative funds into the same messaging structure.”
Jo Van de Velde, head of product management of Euroclear, commented: “In providing the infrastructure for standardised and harmonised messaging we are bringing the hedge fund industry to a more streamlined, efficient and less costly post trade environment.”
Ann Bergin, managing director and general manager of wealth management services at DTCC, said: “Standardisation will help the alternative investment industry tremendously, and we’re happy to be a part of this effort.”
She added: “Standardisation provides efficiency and scalability, which are critical to support broader accessibility and the projected dramatic growth in the alternatives markets.”
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