MIK Fund Solutions, a five-year-old New York-based hedge fund software vendor, released a new broker tracking system for the buyside to help it manage its commission spend.
The system is composed of applications that track hard and soft dollar commissions, sellside research services and event access, and a broker vote feature that drives future commission allocations. It’s a bundled offering, but each feature can be used separately.
By using the system, the buyside can evaluate the performance of its execution and research brokers, helping to keep costs down and maximize commission spend, said MIK chief operating officer Marshall Saffer. As hedge funds and asset managers come under more regulatory requirements, there is a mandate to justify and rationalize broker utilization, he added.
"We are putting metrics against the value of research and other services the sellside is providing in a systematic way," Saffer said. "We want to provide meaningful metrics around the data and make the broker vote process more objective than subjective."
Saffer said the system allows users to view commission data across regions, asset types and commission rate types, aiding in the firm’s broker vote process, which in turn drives the commission budget process. It also provides detailed reporting, trend charting and alerts to assist in the client’s periodic review process.
"In addition, managers have the opportunity to open dialogues with brokers based on ranking, rating and total commission scales," he added.
MIK, founded by technology consultant Fadi Kaddoura in 2006, now has eight clients who are live with the system, which went online in January.
