Many investors now see operational due diligence as more important than investment due diligence. Hedge fund managers need to have efficient and robust operations in order to win new mandates. The Hedge Funds Club’s Stefan Nilsson checks in with Gavin Lauchlan, Chief Product Officer of OpenFin, to find out how the firm assists hedge funds in improving efficiency and achieving better trading and business results. Gavin joined OpenFin last year. He has had a long career in tech for financial institutions, including a decade with JP Morgan.
What can you tell us about the evolution of OpenFin Workspace and what it does?
OpenFin has established itself as the de facto standard across the industry as the most trusted, secure and flexible solution for building a rich desktop experience coupled with the immediate deployment of web applications to the financial desktop. Over 90% of the world’s largest banks have adopted OpenFin to deliver modern web applications to their desktops and their clients’ desktops. With the introduction of OpenFin Workspace, institutions can now adopt out-of-the-box components that allow users to:
- Efficiently find applications and information.
- Discover the applications that are available to them.
- Take action on real-time notifications.
- Maximise their productivity through flexible window management and streamline workflows through simple yet powerful interoperability.
The combination of these components supports and enhances people’s experience in their day-to-day workflows through a unified and easy-to-use experience.
OpenFin Home is the central digital assistant of OpenFin Workspace. It provides a keyboard-driven search interface to put the applications and information people need right at their fingertips. As well as providing fast access to applications, search results shown in OpenFin Home can include rich content such as live ticking data for financial instruments or contact details for client information pulled from a CRM such as Salesforce alongside actions to call or message clients with a single click.
OpenFin Dock provides a floating toolbar, giving single-click access to the tools and workspaces that are needed most.
OpenFin Store offers a place for users to discover what applications are available to them. As a result, people no longer need to raise requests to have the applications they need to use installed on their desktop computer or curate a set of bookmarks that go out of date over time. Instead, they can now browse all the apps that are organised and tailored to their role.
OpenFin Notification Center elevates the experience of simple notifications to support workflows and increase efficiency. For example, rich notifications allow information to be entered directly into a notification itself. In addition, a notification can offer actions that take you straight to the related application ‘in context’ without needing to rekey information.
Finally, the OpenFin Browser is a highly customisable productivity-focused offering that allows end-users to combine multiple applications into windows arranged over their numerous monitors. Users can save their arrangements as workspaces and link applications together so that related apps can update in tandem based on their workflows. All of the OpenFin Workspace components can be themed and branded by an institution, giving their brand pride of place across the entire desktop.
It would seem that efficiency is a key reason why fund managers choose Workspace. Can you explain how it efficiently integrates with Excel and Bloomberg, two key things for many hedge funds?
OpenFin provides integrations with key systems used across the industry. These integrations focus on making it easy to access and share information across these systems and build workflows that can span the entire desktop. For example, a typical hedge fund manager likely has Excel and Bloomberg open on their desktops alongside proprietary trading applications to complete their investment management activities. So, let’s consider how they can use OpenFin to efficiently compose or update their fund portfolios. The portfolio manager’s day starts with opening up a frequently used workspace from OpenFin Home. This workspace has several applications, including:
- An Excel-based stock screen that contains key fundamentals.
- Another couple of Excel workbooks contain investment research models from the sell-side and their own “secret sauce” research.
- A set of Bloomberg launchpad views showing company overview, price charts, market commentary, historical trade and risk analytics.
- A proprietary trading application.
On this day, the goal is to ensure the fund is brought in line to “market-neutral” given recent volatility. The manager notices the fund’s beta has a notable dispersion and will need to make the necessary adjustments and initiate the trades promptly so that the portfolio’s long and short sleeves are beta or risk neutral. With the desktop powered by OpenFin’s integrations for Excel, Bloomberg and interoperability features, the hedge fund manager starts by reviewing their Stock Screener in Excel and downloading it for risk analysis in Bloomberg. The analysis leads to the manager identifying a few key instruments to focus on for market-neutral trades. As each instrument in the Excel screener is selected, all other quantitative model workbooks update instantly to display valuation information and the market data views in Bloomberg update to display updated risk analytics. Armed with this analysis, the manager can perform a “what-if” trade optimisation and scenario analysis back in the Excel stock screener. As position sizes are tweaked in Excel, the manager can see updates to projected portfolio level beta (risk) profiles in the trading application for different market scenarios. In this example, OpenFin enables seamless transitions between sophisticated market data platforms, internal applications and proprietary “secret-sauce” Excel workbooks. As a result, we’ve made managing a complex hedge fund possible with just a few clicks and keystrokes – all while maintaining focus, sharing context and minimising the manual transfer of contextual information that can lead to analysis errors. This is one of many examples of OpenFin’s integration and interoperability capabilities to drive efficient, meticulous unification of disparate desktop tools for a hedge fund manager to generate positive returns through periods of market ups and downs.
How can Workspace be used to create effective workflows that enable portfolio managers and traders to react faster, get a better overview and be better informed?
Let’s pick up from the portfolio manager’s journey above. The manager has found efficiency, but to ensure the objective for the day is met, it is critical to collaborate with traders to complete the trading activities. OpenFin’s Workspace product capabilities extend beyond its integrations and interoperability to support comprehensive workflows. Once the portfolio analysis is complete, the manager can initiate the intended trades from their Excel screener, resulting in a broadcast trade alert to the OpenFin Notification Center and trade ticket submission within the trading application. Now the traders can perform pre-trade checks and book the trades based on these alerts. These notifications toasts can include a link to the analysis summary and trade instructions with contextual instrument information such as a ticker or an identifier. It can also include the ability to launch a trade ticket directly within the trading application or a link to the pre-trade system to seek compliance check approvals. As you can see, the trader never has to copy/paste or manually transfer critical pieces of information from one system to another, thus dramatically reducing exposure to trading errors. As soon as the pre-trade checks are complete, the trader can submit the trades, which would result in a notification back to the portfolio manager indicating that the orders have been filled. These notification toasts to the portfolio manager can include links to open up the updated portfolio so the manager can see updated portfolio betas to ensure the “market-neutral” goal has been reached for the day. Without OpenFin’s Workspace capabilities, accomplishing a complex workflow within a day with high quality and accuracy is very difficult and error-prone. So instead, what we see is a hedge fund manager and their trading team being able to shift focus from “making technology work” to “making hedge fund strategies work” so their clients can benefit from their expertise.
Cost and implementation times can be crucial for hedge funds and other users in the financial world. Does OpenFin Workspace require large in-house development resources or is it pretty much straight out-of-the-box integration?
OpenFin Workspace allows in-house development resources to focus on bringing content together in a unified environment rather than having to build that environment from scratch. Without OpenFin Workspace, it is reasonably common for institutions to have a team of well over a dozen front-end developers building out custom components such as alerting tools, application directories, search interfaces and window management systems – not to mention the extended team of UI designers, test engineers, support engineers and product teams. By adopting OpenFin Workspace, many of these resources can instead concentrate on building out the applications’ capabilities, adopting interoperability standards, and providing seamless workflows powered by OpenFin, with a much smaller team working on configuring and tailoring the out-of-the-box components to meet the institution’s needs.
For more information about OpenFin’s solutions: www.openfin.co/contact