The world of technology is very dynamic, and technology used for investment performance is no exception to this.  First of all, investment performance itself as set of concepts and methodologies has changed and evolved over the last several years.  January 1^st of this year saw the introduction of the latest version of the Global Investment Performance Standards (GIPS^®), and the elimination of the AIMR-PPS^® (and other local standards).  With respect to performance attribution, more firms are using attribution information and finding it necessary to perform attribution analysis on a wider range of accounts.  Fixed income attribution models have been documented, disseminated, and, to some degree, adopted.  These changes and many more have shaped the systems functionality needs of investment firms, driving them to require the technology used to measure investment performance to change accordingly.  At the same time, the software vendor landscape has also changed in the last few years.  We have seen some vendors acquire others (StatPro acquiring AlphaI, SS&C acquiring Financial Models, CheckFree acquiring IDS, for example), and new vendors entering the space.  Changes in operating systems and relational databases add to the dynamism of investment performance technology. 

The technology used to measure investment performance is of great interest to virtually all practitioners, and our survey on Performance Measurement Technology continues to be popular.  We once again received responses from a large number of firms from several countries with different levels of assets under management. 

Where appropriate, we contrast the 2006 results with prior editions of this survey (2001, 2003).  As many of the questions have remained the same over each instance of the survey, we believe that readers will find valuable information not just in the 2006 responses, but also in the trends indicated over time by the combined responses from 2001 through 2006. 

Specialization is a key concept when considering performance technology, and we see that many firms have continued to seek out specialized technology solutions, through either separate software systems from their portfolio accounting system vendors, or the use of outside vendors. 

Spending and budgets related to technology are also of great interest to many firms.  Our survey results indicate that firms are planning to spend somewhat more for technology this year, a development firms and vendors have been watching for over the last several years. 

While functional needs have become more sophisticated and vendors have made many enhancements to their systems over the last several years, it still remains true that spreadsheets are used by a large number of firms for all aspects of investment performance (portfolio returns, composite returns, attribution and risk).  This may be an indication that systems still have a ways to go to satisfy user needs more fully, or that spreadsheets are used for ad hoc or to augment other systems. We continue to discourage the use of spreadsheets for “systems.”

Over the next few pages, we summarize some of the major findings in our research, and that is followed by the full survey details.  (Exerpt taken from report analysis)