Pantechnicon is a hedge fund that executes an equity long-short market-neutral strategy within industrials. The fund launched in 2021 with a global fund and now runs three mandates, including a UCITS and Cayman mandate. It aims to deliver consistent returns with low volatility and low correlation to the market.
Pantechnicon has used Enfusion from Day One. As a front-to-back platform, Enfusion provides Pantechnicon with portfolio management, order management, risk management, and general ledger accounting.
We spoke with Kathy Jackson (Chief Operating Officer) and Joakim Wargclou (Head of Risk and Trading) at Pantechnicon to drill down into the operational benefits of using Enfusion.
Streamlining the trade lifecycle
Pantechnicon initially selected Enfusion because they wanted a partner that could support them as they grew and explored new strategies and opportunities. Said Jackson, “We chose Enfusion over alternative service providers because of the partnership business model that it promoted. And I think this is where it adds the most to our strategy and goals.”
The firm also needed a platform to support the challenges of operating three mandates, especially around trade allocation and reconciliation. Bulk orders and trade compliance also impact their day-to-day operations.
We chose Enfusion over alternative service providers because of the partnership business model that it promoted. And I think this is where it adds the most to our strategy and goals.”
A focus on trade allocations across multiple funds
Managing three differentiated mandates presents challenges in allocating trades efficiently and accurately. To address this, the firm uses an automated trade allocation tool within Enfusion. As a result, they can easily:
- Split orders across multiple funds, even when dealing with both cash equities and swaps/CFDs
- Maintain different allocation templates for each market where they trade (Europe, US, and Hong Kong)
- Send automated end-of-day allocation emails to counterparties such as fund admins and prime brokers with all necessary details
Moreover, Enfusion collaborated closely with Pantechnicon to tailor a solution that would precisely meet their unique needs. This bespoke solution allows them to stay cost-effective and achieve best execution because they place trades in the market that span all three mandates, according to Jackson and Wargclou. Further, they have the capability to integrate the data seamlessly into their internal business intelligence platform, facilitating advanced analyses for best execution.
Consistent and coherent trade reconciliations
Pantechnicon has also improved the efficiency and accuracy of their trade reconciliation process using Enfusion. The platform provides a comprehensive set of reconciliation tools that cover trades, positions, and cash across their prime brokers and fund admins. Pantechnicon leverages the advantages by:
- Performing reconciliations directly within the Enfusion platform rather than relying on external spreadsheets or systems
- Maintaining a complete audit trail of reconciliations within Enfusion
- Quickly identifying and resolving trade breaks or discrepancies
Wargclou highlighted the advantages of having reconciliations embedded within the platform, noting, "Having the reconciliation tool in the system is better because you tend to have issues when they are built outside the system." He added that the integrated reconciliation is "robust, and you have all the history, so you don't rely on a VBA macro that someone else built running outside the main system."
Having the reconciliation tool in the system is better because you tend to have issues when they are built outside the system.”
Additional efficiencies with trading
Pantechnicon sees additional benefits in other areas of their trading workflows.
- Bulk Order Import: Pantechnicon uses Enfusion's import template feature to manage large program trades across their various investment mandates efficiently, reducing manual entry and errors. They can calculate desired positions in each name, generate Excel-based upload templates, and then bring them into Enfusion.
- Compliance: Enfusion's flexible and robust pre-trade compliance tools have allowed Pantechnicon to enhance their regulatory framework and streamline compliance monitoring. Having internal controls has led to improved operational resilience and the ability to handle more compliance tasks in-house. "It has definitely enhanced our approach to addressing the ever-changing compliance and regulatory environment. Our operational resilience has improved as a result of having internal controls embedded in Enfusion," said Jackson.
Words of wisdom
At the end of our conversation, Jackson also shared advice for other firms onboarding with Enfusion: “There tends to be time pressure for a launch, and while it is tempting to get Enfusion up and running in a standard format, there is an enormous benefit in taking time to set up Enfusion thoughtfully. The setup process can be enhanced by developing a strong relationship with the Enfusion account manager while considering the future. “It’s absolutely essential that businesses put a lot of thought into how their business and funds might look in two years' time. Your Account Team can also make recommendations about what’s important to turn on, what’s standard for your peer group, but what’s also ‘the nice to have’ that you might just not be aware of in the platform.”
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