Cloud Computing and the Asian Hedge Fund and Investment Market
Various hedge fund and investment firms have expanded their cloud computing capabilities in Asia in recent years. Through the use of private clouds, thousands of hedge fund professionals around the world have streamlined their operations, reduced their up front costs, increased their resilience, and improved their response time to market fluctuations.
More importantly, cloud computing providers have allowed smaller investment firms and independent hedge fund professionals to gain access to advanced, expensive IT infrastructure that is usually only available for hedge funds dealing with billions of dollars.
In today’s rapidly changing investment market which requires the fastest possible computing power to handle millions of micro-transactions, access to the necessary computing equipment is a must for these firms to stay competitive. Gradually, cloud computing has gained a hold around the world with hedge funds and investment firms, and the Asian market is no exception with a drastic shift in the adoption and attitude towards cloud computing.
The most important hedge fund markets in Asia, without question, are located in Hong Kong and Singapore. An important reason for these markets’ importance in this sector is the fact that they have access to high speed telecommunications and governments have friendly policies to financial firms and technology.
The Asian hedge fund market is peculiar in the sense that large funds tend to struggle more than smaller funds. This may be due to smaller funds’ increased flexibility and manageability, an important factor in the modern financial markets that require quick reaction times and efficiency. To deliver positive results and become competitive, firms in the Asian market are looking to streamline their operations and gain the flexibility and agility available typical of smaller firms, an aspect that is helped tremendously by cloud computing technology.
Cloud technology adoption among Asian hedge fund firms
Cloud service providers have an enormous untapped market in Asia, especially those that can deliver increased security and speeds. Most of the demand among financial firms and hedge fund managers is for private cloud services. There is no doubt that the potential is far from realized in the region. Regulations in different countries have led to vast differences in the levels of cloud computing adoption around Asia. Today, many companies are taking a cautious approach to the cloud, waiting for clearer regulations from governments and for a clearer picture of the benefits that the cloud has to offer hedge funds and investment firms.
What are the obstacles for cloud technology in the Asian financial market?
It is often difficult for companies to enter the Asian market due to its competitive nature and the importance of already established players in the region. This also comes from increased regulations in the West, particularly in the United States and the United Kingdom. Many hedge fund managers have run into obstacles from regulations such as AIFMD (Alternative Investment Fund Directive) which have blocked them from attracting investment capital.
There are also differences in how firms do business, and hedge fund managers in Asia tend to be more cautious when it comes to making significant expenditures in infrastructure and technology at the beginning of a new business venture. There is still widespread ignorance when it comes to how the cloud works and unfounded concerns about privacy have also held many firms back from taking advantage of the many benefits of cloud computing technology.
These attitudes were common in the West only a few years ago, but today most hedge fund firms there have adopted the cloud in some form or another. This bodes well for the future of cloud computing in the Asian hedge fund market. Many aspects, such as expensive real estate and infrastructure have meant that hedge fund firms are looking to outsource many of their infrastructure needs. The most important benefits cloud computing has for this market include:
- Increased speed in operations
- Simplified IT
- Improved flexibility and scalability
- Disaster management and recovery
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About the Guest Author:
Nida Rasheed is a freelance writer and owner of an outsourcing company, Nida often finds herself wanting to write about the subjects that are closest to her heart. She lives in Islamabad, Pakistan and can be found on Twitter @nidarasheed.
