Generating Insight from Financial Data to Unearth Potential Investments

Case Study

Mango was approached by a hedge fund business that was reliant on a rudimentary way of working, involving an over-reliance on spreadsheets that were held in unconnected silos across the business. By using the expertise held within Mango Solutions’ development teams, this organisation has now stopped its reliance on spreadsheets and instead turned to a cloud-based database environment that provides a modern platform for sophisticated modelling – an easier platform to use on a daily basis and maintain in the long term.

 

Challenge

Data is crucially important to hedge fund firms. By generating as much insight as possible from the information it held, the organisation knew it would be able to discover potential investments to help steal a competitive edge over its rivals and generate better returns for its clients.

Unfortunately, the large majority of the company’s data was held in unconnected spreadsheets which created a number of issues. Firstly, the hedge fund firm wasn’t able to undertake higher-level analysis of the data it held. Second, the spreadsheets tended to be held in organisational silos, making it difficult for employees to share data and work across the business. Finally, it wasn’t possible for the firm to enrich the data it held by bringing in data and expert knowledge from alternative financial sources, such as Bloomberg, Morningstar and S&P Capital IQ, and use this combined information to help its analysts to identify new investment trends.

As the firm’s data was held in spreadsheets, it was difficult for employees within the company to undertake system support and maintenance. This lack of standardisation made it difficult for them to combine its financial information and to increase the scale of analysis. In short, an over-reliance on spreadsheets across the hedge fund firm had become an inhibitor to further business growth.

The company was keen to move away from this legacy mode of working – it would be much easier for its analysts to run their models if it could ingest all of its data into a single database platform. While the main driver of this work was to help its employees to undertake better investment analysis, the secondary motivation was to create a cloud-based system that could be more easily maintained going forwards.

 

Solution

Mango Solutions met the hedge fund business and analysed what the firm was trying to do. This period of discovery allowed Mango to become immersed in the company’s activities and their use of technology. Mango then built a series of proof of concepts to show how it would be possible to create a platform that could ingest data from third-party sources and to combine that with internal sources in a single database environment.

These proof of concepts proved the value of having an integrated data layer, resulting in Mango building a platform to production-level quality. With it now possible to use the database on a day-to-day basis, Mango helped the firm create models that would run on top of this platform. This included the kind of heavy-duty statistical modelling that would help the firm’s analysts to identify new investment trends – it was these opportunities that allowed the firm to steal a competitive edge over its rivals.

Mango built the bespoke system using a range of standard technologies and tools – the Google Cloud platform and the Python programming language. These components were brought together and, with Mango’s expertise in modelling, were used to create a single, cloud-based database platform to meet the demands of the firm’s analysts.

 

Benefits

The organisation is now able to undertake comprehensive analysis, using sophisticated models. In comparison to its pre-existing spreadsheet-based approach, the new cloud-based system gives the firm a database environment that is both secure and easy to maintain. Mango continues to provide support to the hedge fund firm and will help to maintain the system in the future. The combination of better modelling and a more reliable system provides the firm with a strong technological platform, for long-term business growth.