Switching fund administrator can prove to be a costly, investor sensitive, risky and time-consuming exercise. This article focuses on 10 areas that hedge fund managers should consider and spend more time on during the selection process of a new administrator.
Communication is the key to a successful and efficient transition.
A seamless transition from one administrator to another is clearly a key requirement for any manager.
It is important that all parties agree a realistic time-frame within which the transition process can be completed.
Clearly, managers need to maintain prudent control over their costs whilst at the same time being conscious of the cost base that an administrator needs to operate and provide a high quality service.
Commitment and service
Managers should be aware that with some administrators there is a risk they will no longer be serviced if they do not raise assets or if their assets drop below a certain level.
As a manager grows, their strategies and geographic reach may also grow.