Family offices

Investment Decision Support for Family Offices

Like all the players within the financial services industry, family offices face a complex and intense financial and economic environment. They increasingly require investment decision making tools and risk management processes to protect and grow capital for the families they represent.

Family offices often have to handle very complex fund structures due to the extensive use of separate managed accounts that can be required as part of their legal structure. In the main they invest in a broad range of asset classes and typically have low trading volumes. Their portfolios tend to be based on direct investments, including extensive use of OTC derivatives and illiquid assets that are generally invested in hedge funds, real estate and private equity. As a result they can be subject to a higher complexity of pricing valuations and risk management.

Family offices are characterized by a high degree of flexibility with regard to the regulatory environment. As they can invest without being bound by the regulatory restraints that are imposed on other financial institutions, their portfolios can be exposed to numerous risk factors.

Our expertise

Sophis has many years experience working with wealth management institutions such as private banks, asset managers and family offices, and is aware of the challenges that these organizations face.

We work closely with family offices to improve efficiency across their structure, by managing front-to-back processes including order generation, portfolio management, cash and fund management, risk management, performance attribution, reporting and accounting.

Sophis is able to cover the complex aspects of a family office business:

• Cross-asset coverage including fund of hedge funds, private equity and real estate investments
• Wide functional coverage with front to back office capabilities from order generation to accounting
• Flexible pricing structures and the ability to take into account low liquidity on almost all asset classes
• Ability to handle very complex fund structures due to the extensive use of separate managed accounts

Because all of the functionality is built into one system, family offices can have a single view of their portfolios, no matter how complex or diverse. Therefore they can manage risk in line with internal or external investment constraints, as well as reduce their own cost of servicing clients.

Our solutions enable family offices to promote best practices within wealth management and to achieve short and long-term objectives thanks to an efficient and sophisticated portfolio and risk management system.

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