Cloud Computing Proving To Be Major Resource For Hedge Funds

Cloud Computing Proving to be Major Resource for Hedge Funds

As we near the end of Q1 2013, hedge fund managers continue to generate higher returns. Following several years of sub-par performances from global hedge funds, investment managers have turned to cloud computing and infrastructure-as-a-service providers to not only cut costs, but also boost productivity. Many of the concerns that managers once had about migrating to cloud-based IT solutions, such as security, privacy and application performance, have been alleviated, and the benefits, such as cost predictability, business continuity and scalability, are tangible.

Cost Predictability

As small- to medium-sized hedge funds look to do more with less in the face of today’s regulatory and investor pressures, they need to be able to anticipate and account for their expenses. These firms don’t typically have the budget to absorb surprises related to building and maintaining on-site data centers, which can bring major distraction, a budgeting nightmare and significant risk. A cloud services model offers an out-of-the-box functional infrastructure, deployment in days and drastically reduced start-up risk. Cloud providers own all the equipment and are already used by other funds, so the manager doesn’t need to write the big check up front or worry about any potential missed details.

Unpredictable expenses don’t stop once the data center is built. Equipment can break or simply need to be replaced, and firms face mandatory system upgrades, data corruption and hard drive failure, among other challenges. Adding or removing capacity can also result in hard-to-predict costs, and staff levels must be adjusted at certain thresholds — preferably before workloads reach critical levels. Cloud service providers hedge this risk in exchange for a predictable monthly subscription fee, where even the added or lowered costs of scaling the needed capacity is predictable, since the cost and required lead time for making that change are known ahead of time.

Business Continuity

Hedge funds are held to high standards when it comes to their business continuity plans. A technology failure can be disastrous for money managers, yet more firms than ever are entrusting cloud service providers to “disaster proof” their business. This is because dedicated cloud service providers benefit from economies of scale and can offer a product that is constantly validated by others using the same service. Relocating and replicating IT resources to off-site locations also protects businesses from disasters in primary offices. Funds can tailor solutions to their specific business needs, or outsource “a-la-carte,” moving all their IT resources off site, or outsourcing only key components.

Key man risk is also common in hedge funds with only one or two IT people that are qualified to trouble-shoot technology issues. If those individuals are unavailable at a time of emergency, the result can be disastrous for the business. Consultants can help in an emergency, but they still require time and money to gain familiarity with the IT environment. Having just a few key IT individuals also poses the risk of their own limited capacity; it’s not feasible for one person to monitor the health of an on-site data center 24/7 with very short response times. Conversely, cloud service providers employ teams of dedicated staff that monitor the network 24/7.

Scalability

Cloud providers offer the unique ability to quickly and cost-effectively meet changing business needs. Hedge funds no longer need to worry about how to expand their IT capacity, technical staff levels or server space, or fund new hardware and software resources to grow or enter new markets. Instead, managers can embrace an outsourced model that lets them focus on their core business rather than invest time and effort into solving IT problems. “Scaling down” can be as simple as a phone call, meaning fund managers no longer need to focus on staff layoffs, reselling hardware, or low data center use.

By using these services, hedge funds no longer have to spend the time and money required to build an in-house platform. Cloud service providers can offer an established infrastructure to get managers up and running within days instead of weeks or months. While some managers still perceive cloud computing as an emerging trend in the financial space, it has undoubtedly become an integral part of many hedge funds’ business strategies. It has become evident that IT outsourcing services run day-to-day operations more efficiently and offer managers the chance to scale more effectively, enabling firms to turn over the hassle of managing IT to a trusted partner and focus instead on their core business.

By Chris Grandi, CEO, Abacus Group

About CloudTweaks

Established in 2009, CloudTweaks is recognized as one of the leading authorities in connected technology information and services.

We embrace and instill thought leadership insights, relevant and timely news related stories, unbiased benchmark reporting as well as offer green/cleantech learning and consultive services around the world.

Our vision is to create awareness and to help find innovative ways to connect our planet in a positive eco-friendly manner.

In the meantime, you may connect with CloudTweaks by following and sharing our resources.

View All Articles

Sorry, comments are closed for this post.

Comic
Staying on Top of Your Infrastructure-as-a-Service Security Responsibilities

Staying on Top of Your Infrastructure-as-a-Service Security Responsibilities

Infrastructure-as-a-Service Security It’s no secret many organizations rely on popular cloud providers like Amazon and Microsoft for access to computing infrastructure. The many perks of cloud services, such as the ability to quickly scale resources without the upfront cost of buying physical servers, have helped build a multibillion-dollar cloud industry that continues to grow each…

Are CEO’s Missing Out On Big Data’s Big Picture?

Are CEO’s Missing Out On Big Data’s Big Picture?

Big Data’s Big Picture Big data allows marketing and production strategists to see where their efforts are succeeding and where they need some work. With big data analytics, every move you make for your company can be backed by data and analytics. While every business venture involves some level of risk, with big data, that risk…

Moving Your Email To The Cloud? Beware Of Unintentional Data Spoliation!

Moving Your Email To The Cloud? Beware Of Unintentional Data Spoliation!

Cloud Email Migration In today’s litigious society, preserving your company’s data is a must if you (and your legal team) want to avoid hefty fines for data spoliation. But what about when you move to the cloud? Of course, you’ve probably thought of this already. You’ll have a migration strategy in place and you’ll carefully…

5 THINGS TO CONSIDER ABOUT YOUR NEXT ENTERPRISE FILE SHARING SOLUTION

5 THINGS TO CONSIDER ABOUT YOUR NEXT ENTERPRISE FILE SHARING SOLUTION

Enterprise File Sharing Solution Businesses have varying file sharing needs. Large, multi-regional businesses need to synchronize folders across a large number of sites, whereas small businesses may only need to support a handful of users in a single site. Construction or advertising firms require sharing and collaboration with very large (several Gigabytes) files. Financial services…

Having Your Cybersecurity And Eating It Too

Having Your Cybersecurity And Eating It Too

The Catch 22 The very same year Marc Andreessen famously said that software was eating the world, the Chief Information Officer of the United States was announcing a major Cloud First goal. That was 2011. Five years later, as both the private and public sectors continue to adopt cloud-based software services, we’re interested in this…

The Cloud Is Not Enough! Why Businesses Need Hybrid Solutions

The Cloud Is Not Enough! Why Businesses Need Hybrid Solutions

Why Businesses Need Hybrid Solutions Running a cloud server is no longer the novel trend it once was. Now, the cloud is a necessary data tier that allows employees to access vital company data and maintain productivity from anywhere in the world. But it isn’t a perfect system — security and performance issues can quickly…

HOW THE CFAA RULING AFFECTS INDIVIDUALS AND PASSWORD-SHARING

HOW THE CFAA RULING AFFECTS INDIVIDUALS AND PASSWORD-SHARING

Individuals and Password-Sharing With the 1980s came the explosion of computing. In 1980, the Commodore ushered in the advent of home computing. Time magazine declared 1982 was “The Year of the Computer.” By 1983, there were an estimated 10 million personal computers in the United States alone. As soon as computers became popular, the federal government…

5 Ways To Ensure Your Cloud Solution Is Always Operational

5 Ways To Ensure Your Cloud Solution Is Always Operational

Ensure Your Cloud Is Always Operational We have become so accustomed to being online that we take for granted the technological advances that enable us to have instant access to everything and anything on the internet, wherever we are. In fact, it would likely be a little disconcerting if we really mapped out all that…

Utilizing Digital Marketing Techniques Via The Cloud

Utilizing Digital Marketing Techniques Via The Cloud

Digital Marketing Trends In the past, trends in the exceptionally fast-paced digital marketing arena have been quickly adopted or abandoned, keeping marketers and consumers on their toes. 2016 promises a similarly expeditious temperament, with a few new digital marketing offerings taking center stage. According to Gartner’s recent research into Digital Marketing Hubs, brands plan to…

Disaster Recovery – A Thing Of The Past!

Disaster Recovery – A Thing Of The Past!

Disaster Recovery  Ok, ok – I understand most of you are saying disaster recovery (DR) is still a critical aspect of running any type of operations. After all – we need to secure our future operations in case of disaster. Sure – that is still the case but things are changing – fast. There are…

5 Essential Cloud Skills That Could Make Or Break Your IT Career

5 Essential Cloud Skills That Could Make Or Break Your IT Career

5 Essential Cloud Skills Cloud technology has completely changed the infrastructure and internal landscape of both small businesses and large corporations alike. No professionals in any industry understand this better than IT pros. In a cutthroat field like IT, candidates have to be multi-faceted and well-versed in the cloud universe. Employers want to know that…

The Internet of Things Lifts Off To The Cloud

The Internet of Things Lifts Off To The Cloud

The Staggering Size And Potential Of The Internet of Things Here’s a quick statistic that will blow your mind and give you a glimpse into the future. When you break that down, it translates to 127 new devices online every second. In only a decade from now, every single vehicle on earth will be connected…

Cloud Infographic – Cloud Public, Private & Hybrid Differences

Cloud Infographic – Cloud Public, Private & Hybrid Differences

Cloud Public, Private & Hybrid Differences Many people have heard of cloud computing. There is however a tremendous number of people who still cannot differentiate between Public, Private & Hybrid cloud offerings.  Here is an excellent infographic provided by the group at iWeb which goes into greater detail on this subject. Infographic source: iWeb

Cloud Infographic – The Future Of Big Data

Cloud Infographic – The Future Of Big Data

The Future Of Big Data Big Data is BIG business and will continue to be one of the more predominant areas of focus in the coming years from small startups to large scale corporations. We’ve already covered on CloudTweaks how Big Data can be utilized in a number of interesting ways from preventing world hunger to helping teams win…

Expert Insights Into The Yahoo Breach

Expert Insights Into The Yahoo Breach

Yahoo Breach Latest reports suggest that the recent Yahoo! data breach may exceed 500 million records, with some sources implying millions more records penetrated, upping the total number of records stolen in various recent hacks to approximately 3.5 billion. CloudTweaks spoke to Kevin O’Brien, CEO of GreatHorn, for expert insight into this latest violation. GreatHorn…

Using Private Cloud Architecture For Multi-Tier Applications

Using Private Cloud Architecture For Multi-Tier Applications

Cloud Architecture These days, Multi-Tier Applications are the norm. From SharePoint’s front-end/back-end configuration, to LAMP-based websites using multiple servers to handle different functions, a multitude of apps require public and private-facing components to work in tandem. Placing these apps in entirely public-facing platforms and networks simplifies the process, but at the cost of security vulnerabilities. Locating everything…

Big Data’s Significant Role In Fintech

Big Data’s Significant Role In Fintech

Data Banking Fintech covers a range of financial fields such as retail banking, investments, and lending and thanks to the mobile and internet innovations of late is a thriving sector. Offering improvements which drive customer satisfaction and education in an area previously inscrutable and dictated by gigantic inflexible corporations, fintech is helping put the power…

Battle of the Clouds: Multi-Instance vs. Multi-Tenant

Battle of the Clouds: Multi-Instance vs. Multi-Tenant

Multi-Instance vs. Multi-Tenant The cloud is part of everything we do. It’s always there backing up our data, pictures, and videos. To many, the cloud is considered to be a newer technology. However, cloud services actually got their start in the late 90s when large companies used it as a way to centralize computing, storage,…

Infographic: 9 Things To Know About Business Intelligence (BI) Software

Infographic: 9 Things To Know About Business Intelligence (BI) Software

Business Intelligence (BI) Software  How does your company track its data? It’s a valuable resource—so much so that it’s known as Business Intelligence, or BI. But using it, integrating it into your daily processes, that can be significantly difficult. That’s why there’s software to help. But when it comes to software, there are lots of…