BondIT, an independent portfolio construction technology provider for fixed income, and Scorable, a provider of AI-driven credit analysis, are to merge and combine their technologies in a bid to transform fixed-income investing.
BondIT, an independent portfolio construction technology provider for fixed income, and Scorable, a provider of AI-driven credit analysis, are to merge and combine their technologies in a bid to transform fixed-income investing. The transaction is expected to close by the end of 2020.
Bringing together cutting-edge technology and advanced AI, the combined company will offer a fully integrated portfolio management and research as a service solution, enabling fixed income asset managers and financial advisors to automate and optimise the investment process. The solution empowers users to build and analyse portfolios within minutes rather than hours or days.
Additionally, BondIT’s and Scorable’s uniquely scalable solution allows asset managers to rebalance existing portfolios and define and manage universes, including approved or restricted issuer lists. Users can simply specify their individual portfolio objectives and bond level constraints and get results in real-time, improving productivity and efficiency for asset managers while helping scale revenues. Further, the new solution seamlessly integrates with asset managers’ internal models and connects with existing order management and execution systems.
“Fixed income investors still rely heavily on manual-driven procedures, but in light of market and cost pressures, intelligent automation is increasingly necessary to stay competitive. Merging our technologies allows us to even better serve the evolving digital needs of our clients by helping them optimise their portfolio and risk management to boost efficiency, performance and scale,” says Etai Ravid, CEO of BondIT. “This merger further supports BondIT’s goal of creating a one-stop platform for Explainable Portfolio Construction, to allow users to easily understand the rationale behind the investment selection by making idea generation transparent and intuitive.”
Philippe Padrock, Managing Director of Scorable, says: “Most portfolio managers have access to a large amount of data, but they struggle to turn it into a competitive advantage. It needs the right tools to transform data into useful intelligence. Implementing technology to centralise information and data is imperative, and Scorable’s explainable AI does exactly that by turning vast amounts of data into relevant insights and translating these into appropriate actions based on the portfolio objectives – all in a fraction of time that the manual process would take.”
Scorable’s predictive credit and relative value analysis combines and contextualises more than 400 quantitative and qualitative data variables to help asset managers create optimal portfolios and better manage evolving risks. The company leverages explainable AI across the whole portfolio lifecycle to identify and predict changes in credit risk as well as spot investment opportunities ahead of the market.
Combining BondIT’s established footprint in the US and APAC with Scorable’s presence in Europe will significantly boost the combined company’s international reach, building on existing market knowledge, infrastructure and relationships to target the USD80 trillion global asset management market. BondIT and Scorable are backed by investors and partners across the globe, with total investment in the combined company amounting to more than USD40 million. Talanx AG, a supporter of Scorable since day one, will continue to be a major investor through its subsidiary Ampega Asset Management GmbH.
Harry Ploemacher, CEO of Ampega Asset Management, says: “Asset managers need to digitalise if they want to stay competitive. Smart technologies are more important than ever to successfully navigate challenging markets. By combining their expertise, BondIT and Scorable have created a streamlined and efficient technology solution that meets the needs of fixed-income managers and helps them adapt to a changing industry. We’ve been successfully using Scorable’s technology since its market launch and we look forward to supporting the new company as it enters its next phase of development.”