Morgan Stanley, one of the largest sponsors of managed accounts in the United States, has outsourced its middle- and back-office services for its managed account platform Alphas.
The provider will be GlobeOp Financial Services, based in New York and London.
"Managed accounts require significant infrastructure to meet fund manager and investor demands for operational transparency and independently reconciled data," said Ron Tannenbaum, managing director for GlobeOp in London.
Best known as an independent, non-bank-owned administrator of hedge funds, GlobeOp said that it will use its GoMap managed accounts platform to reconcile cash balances, transactions and securities positions on a daily basis.
The reconciliations between the fund managers serviced by Morgan Stanley and prime brokers and custodians create net asset values for managed accounts.
GlobeOp will also create a daily fair market value for all over-the-counter derivative positions and a full net present value for each counterparty using its proprietary pricing models.
Morgan Stanley confirmed the agreement with GlobeOp but declined to comment further.
Separately managed accounts are typically marketed by distributors (otherwise known as sponsors) to high-net-worth individuals as an alternative to mutual funds. Securities in these portfolios are purchased on behalf of the individual investor.