Orbitex Management, the N.Y.-based subsidiary of the Orbitex Group of Funds, has installed Advent Software's trade order management and portfolio management and accounting systems, Moxy and Axys. The firm, a relative start-up, has relied on manual processes for the past couple of years to handle its trading and back-office operations, and is relying on Advent to achieve straight-through processing (STP) as it looks to increase its assets under management, currently at $275 million, by 10 times over the next few years.
"When I arrived in December of 1998, we had a business plan that said we wanted to grow the business by 10 times," explains Kevin Meehan, chief operating officer. "We didn't have a major (IT) infrastructure in place, we didn't have a platform. With a manual processing environment, if you add 10 times the volume, in most cases, that comes close to 10 times the amount of people to process it. An electronic processing environment would give us control and efficiency and scalability."
The firm began looking at vendor products at the beginning of the year, but did not conduct a formal request-for-proposal (RFP) process because Meehan was previously an IT consultant and, as he puts it, "I know what it's all about." After beginning with a list of 20 vendors, the firm narrowed it down and contacted six of them, then further narrowed it down to three systems which the firm tested. Meehan declines to name which other systems were considered.
Orbitex elected to go with Advent because it is one integrated system that handles front- to back-office throughput, and because it is priced competitively. The firm will also be using Rex, Advent's automated reconciliation module, which connects to Advent's file server via the Internet which then shoots out to the custodian. Exceptions are plucked out automatically and then remedied by the appropriate operations manager.
The money manager is impressed with Advent's push to bring more and more of its products online, citing Rex and Advent's browser-based reporting tool which the firm is considering.
The firm will not be using Axys for all its fund accounting, which is primarily outsourced to State Street Mutual Fund Asset Services. Axys will be used primarily for the firm's internal books and records, portfolio management, and for settling trades. Axys is electronically linked with State Street, the Depository Trust Company and pricing vendors.
Moxy automates the trade order management process, but trading will still be done by phone. An Orbitex money manager will send a trade request electronically to the trader-specifying whether it's a market or limit order and what brokers to contact. The trader then phones the order into a broker, and once the trade is executed, the trader will then send the confirmation back up to the manager via Moxy.
Axys will become an increasingly important part of the fund manager's operations as it looks to expand into separate account management. The installation required the purchase of an extra file server for Moxy, while Axys resides on an existing one.