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Even before Burton Malkiel popularised the term in 1973, investors had begun taking random walks and applying other theories supporting diversification of their portfolios. Yet today, the investment community, in particular the decision-making community, might be observed to be concentrating.

Singapore fintech firm Noviscient is looking to change the way investors find alpha via a technology driven platform that helps select and allocate to quality alpha funds.Scott Treloar, founder at Noviscient in Singapore, said the technology was similar to how Amazon provided a matching service for customers and suppliers. Noviscient’s platform, however, allowed the firm to tailor custom solutions for investors from trade data collected from participating funds, making it more than just a matching service.

A few years ago, as the chief risk officer at an Asian alternative investments firm, Scott Treloar found himself in an unexpected situation.The company, which had been managing over US$5 billion, was trying to raise capital for hedge funds. Treloar thought it would be a breeze.Much to his surprise, no one was interested – and they failed to raise any money.Investors said they weren’t keen on hedge funds, as those had been performing poorly for the past decade. In 2019, fund managers underperformed in the S&P 500 Index – a commonly used benchmark – for the ninth consecutive year.

Singapore-based AI open-platform fund manager Noviscient has been selected as one of eight winners and the first Asian startup to join the Copenhagen Fintech Accelerator.The Singaporean-Danish FinTech tie continues to pave the way for strong startup collaboration – the latest living proof is Noviscient, pointed out the investment management firm in a press release.

We’ve organized our first webinar in January 2019. During this webinar, our founder Scott Treloar discusses the benefits of working with as an Alpha Partner, how to get started and how you can connect to us. In case any of you have questions about this, please email us at alpha@noviscient.com.

Noviscient, a Singapore-based alternative investment shop, is crowdsourcing independent systematic traders and packaging them into a hedge fund.The aim is to use APIs and a computerized risk model to create a vehicle that strips out almost all of the costs associated with hedge funds, while providing a business opportunity for quants with clever ideas.“I’m not paying portfolio managers,” said Scott Treloar, founder. “They only get paid if they perform.”He says Noviscient is not a matching service: it’s a “platform fund”. He’s not putting fund managers together with institutional investors. “The value is in selecting who has got alpha,” he told DigFin. “We allocate to managers doing well and weed out those doing poorly. ”There is plenty of talent out there, people coming out of investment banks or other funds who want to apply their quant expertise to portfolios, but the high capital requirements to start a hedge fund tend to strangle most of these efforts.

A little over twenty years ago I moved from chemical engineering to finance. Interestingly, I still consider myself an engineer. I always figure I can solve any problem, which in the case of chemical engineers is through processes.I was attracted to finance because it is a technically demanding and very interesting field. Unfortunately, it is also opaque and usually poorly understood. This is a shame because it is very important for everyone in this modern world for finance to operate effectively.

Noviscient has been featured on Bloomberg with an article on new Asian fund startups that are eschewing the 2/20 fee model. We believe that moving to a 0% management fee structure and providing downside offers better alignment for investors by creating incentives to focus on performance and exercising sound risk management practices.

In the last post, we were left with the suspicion that the asset management industry has some work in front of it to be “ready, willing and able” to create value for its investors.Are we ready to radically change our processes and infrastructure and mindsets?Are we willing to completely restructure our fees and operate with full transparency to be truly aligned with our investors?With our existing people, technology and capabilities, are we able to offer real risk-adjusted performance while cutting costs by up to 90% and delivering real-time engagement for our investors?

We are in one of the most interesting times in investment management. There will be more opportunities to build great businesses than ever before, but they will be different from the past. At Noviscient we are working very hard to re-imagine how investment management can and should work. We are in the process of building one of these great businesses.From our point of view, the current business model for active management and hedge funds is not working. Fees are high, performance is poor and alignment is low. This is an opportunity but it needs a new approach.