PRINCETON, N.J. - Insurance companies, mutual funds and money managers are substituting personal computers for expensive mainframes to run portfolio accounting software, according to Gordon J. Gacek, director of marketing for Princeton Financial Systems Inc.
Princeton Financial Systems licensed 37 of its PAM portfolio accounting and management software programs in 1993. In 75% of the cases, PAM - which operates on personal computers - replaced portfolio accounting programs on mainframe computers, said Mr. Gacek.
The PAM programs usually are installed on personal computers that are part of a network for convenience in transmitting information.
In two of the 37 instances, PAM replaced mainframe systems with insurance companies managing hefty amounts of assets. Trans America Life, Los Angeles, which manages $23 billion, and American General Corp., which manages $25 billion, replaced their mainframe systems with PAM for Securities.
PAM for Securities is a portfolio accounting and management system that performs portfolio management, analysis, operations and accounting.
Princeton Financial also licenses PAM software portfolio accounting and management systems for mortgages, mutual funds and trading.
Money managers are replacing the mainframe accounting systems with PAM partly to reduce costs, said Mr. Gacek.
Personal computers using a network, he said, avoid the overhead costs of hiring systems analysts, operation personnel and other high costs associated with mainframe systems.
In licensing PAM programs to 37 investors in 1993, Princeton Financial did about twice the PAM business as it did the year before, said Mr. Gacek. Besides being less expensive to operate on personal computer systems, the PAM programs offer more functions than some of the portfolio accounting and management programs run on mainframes, he said.
PAM programs are typically used by investors running more than $500 million in assets. While PAM is most popular with insurance companies, it is starting "to make a splash" with other types of money managers, said Mr. Gacek. For example, in 1993 Princeton Financial licensed PAM for Securities to U.S. Trust Co. of New York, a New York bank, and White River Capital Management, a White Plains, N.Y., investment firm.
The 37 investors who licensed copies of PAM in 1993 manage a total of $110 billion in assets. In 1993, Princeton Financial licensed PAM for mutual funds to CUNA Mutual Insurance Group, Madison, Wis., and Paul Revere Life Insurance Co., Worcester, Mass.
More information may be obtained by contacting Princeton Financial at (609) 987-2400.
GlobeFlex, San Diego, a global money management firm, and The McCamish Group L.P., Atlanta, a globally diversified investment firm, have both licensed the portfolio management software system GLOBAL EPVS from Computer Aided Decisions Inc., Boston.
GLOBAL EPVS is a real-time, multicurrency portfolio management and accounting system that will play an important role at GlobeFlex, a new money management firm. Among those who have founded GlobeFlex are Robert Anslow and Jon Pihlblad, formerly with the Systematic Global Portfolio Management/Research Group at Nicholas-Applegate Capital Management, San Diego.
GlobeFlex is licensing the expanded portfolio valuation system of Global EPVS, according to Bud Weiler, chief executive officer at Computer Aided Decisions. The program being installed at GlobeFlex will have two modules, one for record keeping and another for performance measurement and research.
Among things the record-keeping module will give GlobeFlex is appraisals on its securities, information on its currency balances, investment return numbers for its derivatives. The module also will automatically give time-weighted rates of return on the portfolios and its components in multiple currencies. The software also will generate reports for clients' portfolios.
The research module is being customized for GlobeFlex. The module is an analytic component of the software.
In Boston, Computer Aided Decisions licensed its GLOBAL EPVS portfolio management system with The McCamish Group to replace a microcomputer portfolio system McCamish had outgrown.
GLOBAL EPVS was installed on a file server running the operating system UNIX. With that configuration, McCamish personal computer workstations - linked through a Novell network - can enter trades and extract multicurrency accounting and performance reports plus other data on demand.
Computer Aided Decisions can be reached at (617) 227-2288.
Help with CMOs
NEW YORK - Global Advanced Technology Corp. has developed an accelerated analytical system that permits analysis in a single day of a large portfolio of complex collateralized mortgage obligations.
GAT calls the accelerated process a CMO Risk System, which, GAT officials say, takes advantages of new high-speed computer multiprocessors. In a test of its system, GAT used two Sun SPARCStations and four HyperSparc CPUs to reduce time in calculating risk characterizations on complex CMOs.
GAT officials said the calculations were completed in one-fourth the time it took using a single processor on an Alpha processing platform.
"This thing really cooks," said Vernon Budinger, head of GAT's Financial Strategies Group. "Watching the multiprocessors kick in is like shifting gears on a hot rod," he said.
More information can be obtained by contacting GAT at (212) 785-9630.