CISI Technology in Investment Management key terms

Handling a trade from execution to settlement without manual re-keying or intervention. Data flows electronically between order, portfolio and settlement systems, reducing errors and delays.

Authoritative system holding current and historical positions, cash and transactions for a portfolio. It gives a single, reconciled view of holdings independent of the accounting book used for reporting.

System of record for official accounting values such as book cost, realised and unrealised gains, and NAV inputs. It is typically the fund accountant's ledger rather than the trading view of positions.

Software that captures, routes and tracks orders through their lifecycle, applying pre-trade checks, allocations and execution management. It links portfolio managers, traders and downstream settlement systems.

Trading workstation used by dealers to manage working orders, access venues and algorithms, and monitor execution quality in real time. It often sits alongside or inside an OMS.

Standard messaging format for electronic exchange of trade and order information between buy-side, sell-side and venues. Widely used for order routing, execution reports and post-trade confirmations.

Algorithm that splits and directs orders across multiple trading venues according to rules such as price, liquidity and speed, aiming for best execution under prevailing market conditions.

Regulatory duty to take all sufficient steps to obtain the best possible result for clients when executing orders, considering price, cost, speed, likelihood of execution and settlement, size and nature.

Post-trade measurement of execution quality, comparing achieved prices against benchmarks such as arrival price, VWAP or implementation shortfall to assess slippage, timing and venue performance.

Execution benchmark measuring the gap between the decision price when an order was conceived and the final executed price, capturing both market impact and delay costs.

Automated validation of an intended order against investment mandates, restrictions and regulatory limits before release to the market, blocking or flagging breaches at the point of order entry.

Daily or periodic testing of actual portfolio holdings and transactions against guidelines, regulations and internal limits after execution, generating exceptions for investigation and remediation.

Translating client guidelines and regulatory restrictions into machine-readable rules within compliance or order systems, including permitted instruments, concentration limits and prohibited securities.

Adding reference and settlement data to an executed trade, such as standing settlement instructions, commission, counterparty and place of execution, so it can be confirmed and settled.

Pre-agreed record of the accounts, custodians and payment details used to settle trades with a given counterparty or for a given market, reducing reference data errors at settlement.

The elapsed time between trade execution and final transfer of cash and securities, conventionally expressed as T+n. Shortening cycles reduce counterparty and market risk.

Settlement mechanism in which transfer of securities occurs only if the corresponding cash payment occurs simultaneously, removing principal risk that one leg settles without the other.

Entity holding securities in immobilised or dematerialised form and operating the book-entry system that records and transfers ownership, often providing settlement and asset-servicing functions.

Institution that safekeeps client assets, settles trades on the client's behalf, collects income and processes corporate actions, and provides reporting and asset-servicing services.

Capturing, validating and applying events such as dividends, splits, mergers and rights issues to positions and cash, including elections, entitlement calculations and reconciliation with custodians.

Systematic comparison of two records, such as internal positions versus custodian statements or broker confirmations, to detect and resolve breaks in holdings, cash or transactions.

Attributes used to assess fitness of data, typically completeness, accuracy, timeliness, consistency, validity and uniqueness. They underpin measurement and control of data quality.

Documented path showing where a data element originates, how it is transformed and where it is consumed, supporting impact analysis, auditability and root-cause investigation of errors.

Designated system or dataset treated as the authoritative origin for a particular data attribute, against which other copies are validated and synchronised.

Discipline and supporting technology for creating and maintaining consistent core entities such as securities, counterparties and accounts across systems, reducing duplication and conflicting identifiers.

Static or slowly changing data used to describe and process transactions, including instrument identifiers, calendars, currencies, counterparties and settlement details. Errors here propagate widely across processes.

Framework of roles, policies, standards and controls that assigns ownership and accountability for data, ensuring quality, security and regulatory compliance across the organisation.

Named individual accountable for the quality, definitions and appropriate use of a defined data domain, acting as the point of escalation for issues and change requests.

Value of a fund's assets less liabilities, divided by units or shares outstanding to give a per-unit price used for subscriptions, redemptions and performance reporting.

Processes ensuring positions are priced with approved sources and methods, including price tolerance checks, stale price detection, fair value adjustments and independent review of overrides.

Analysis decomposing portfolio return versus a benchmark into allocation, selection and interaction effects, helping clients and managers understand sources of relative performance.

Secure web or mobile channel giving clients self-service access to statements, holdings, performance and documents, often replacing scheduled PDF distribution with on-demand, personalised data.

Defined interface allowing software systems to exchange data and functions programmatically. In investment management it supports data distribution, order routing and integration with client platforms.

Software bots that replicate repetitive rule-based human actions across user interfaces, such as copying data between systems, typically used where APIs are unavailable.

Combining RPA with machine learning, optical character recognition and workflow tools to handle semi-structured tasks and exceptions, extending automation beyond deterministic rules.

Risk that a model's outputs are wrong or misapplied, arising from poor data, overfitting, concept drift or unclear ownership. Requires validation, monitoring, explainability and governance controls.

Degree to which a model's decisions can be understood and justified to users, auditors and regulators. It is a key condition for using AI in investment and compliance decisions.

Independent assessment of a model's design, data, assumptions, performance and limitations before and during use, confirming it is fit for purpose and adequately controlled.

Documented arrangements for maintaining or restoring critical operations during disruption, covering alternate sites, staffing, system failover and communication, tested regularly.

Maximum acceptable time to restore a system or process after disruption, used to prioritise recovery effort and set the design of resilience and backup arrangements.

Ability of a firm to prevent, adapt to, respond to and recover from operational disruption while continuing to deliver important business services within defined impact tolerances.

Ongoing process of due diligence, contracting, monitoring and exit planning for external providers, ensuring their failures, concentration and subcontracting do not breach the firm's obligations.

Arrangement where a provider performs a process or function the firm would otherwise carry out itself, requiring regulatory notification, contractual safeguards and retained oversight.

Contractual schedule defining measurable service standards such as availability, accuracy and response times, together with remedies and reporting obligations for the provider.

Delivery of computing resources over networks on demand, in public, private or hybrid models. It raises questions of data residency, concentration, access control and exit strategy.

Controlled process for planning, testing, approving and releasing system changes, including impact assessment, segregation of duties and rollback arrangements to protect production stability.

Business-led testing confirming that a new or changed system supports real workflows and meets agreed requirements before go-live, using representative data and documented sign-off.

Moving data from legacy to new systems, including extraction, cleansing, mapping, loading and reconciliation, with parallel runs to prove completeness and accuracy.

Design approach building systems as small, independently deployable services communicating through interfaces, increasing flexibility and scalability but adding integration and operational complexity.

Deception attack using fraudulent messages that impersonate trusted parties to trick staff into revealing credentials or executing malicious payloads. It is a leading route to account compromise.

Access control requiring two or more independent evidence types, such as password plus device code, reducing the impact of stolen credentials on trading and data systems.

Controls governing powerful accounts such as administrators and system operators, including vaulting of credentials, just-in-time elevation, session recording and periodic review.

Malware that encrypts or exfiltrates data and demands payment for restoration, threatening availability of trading and settlement systems and requiring offline backups and tested recovery.

Technology applied to meet regulatory obligations more efficiently, such as automated transaction reporting, surveillance, record-keeping and regulatory change tracking.

Automated monitoring of orders and trades for market abuse indicators such as spoofing, layering, insider dealing and collusion, generating alerts for compliance investigation.

Submitting prescribed details of executed transactions to a regulator or approved mechanism within deadlines, requiring complete, accurate and timely reference and counterparty data.

Identity verification and due diligence process for clients and beneficial owners, supported by screening, document capture and periodic refresh systems to meet anti-money-laundering obligations.

Statistical estimate of the maximum expected loss on a portfolio over a defined horizon at a given confidence level, used for risk limits and regulatory capital calculations.

Evaluating portfolio or firm resilience under severe but plausible scenarios, such as rate shocks or market crashes, to reveal vulnerabilities beyond normal statistical risk measures.

Maintaining accurate, timely records of holdings and cash by applying trades, corporate actions and cash movements, forming the basis for valuation, risk and client reporting.