Many individuals and businesses prefer spreading their risks through investment opportunities like private equity or hedge funds. But the fact that these investments get managed by use of computer software, they get prone to risky aspects. Cybersecurity has become a major concern when dealing with these investment plans. Security measures should get put in place to prevent the system and data manipulation, and infiltration. According to Agio, a financial service institution, hedge funds are more secure than private equity firms and encourages individuals to invest in them.
Unfortunately, many people do not invest in hedge funds as their complex systems, more data, transactions, and cash movements are counterintuitive. Hedge funds don’t make any sense to them. According to most individuals, these complexities make the hedge funds vulnerable. But Agio disagrees with this perception as it asserts that other multiple factors attribute to an investment’s security. Here below, various factors that affect the safety of investment get discussed.
The security of private equity and hedge funds get determined by the data and geographical surface area. Managers and persons connected to the investment move between geographic locations to effectively monitor the projects in private equity. As a result, it becomes difficult to predict data locations and the path. But hedge funds have no movements, and predicting the patterns and data to get accessed within a specific period like a year is easy.
Traditional security enterprises is another factor that favors hedge funds as a perfect investment alternative. One gets guaranteed physical security on-premise. Unfortunately, it is not so for the private equity and data as a physical location gets involved. Agio reduces these vulnerabilities by providing security for physical on-premise. To protect data, many private equity managers use much hardware like tablets and laptops protect their data.
Though it is strategic in enhancing data security, many consumer devices cause data vulnerability to cybercriminals. Besides, managing many consumer devices is challenging, giving a chance to cybercriminals to infiltrate the whole system. In this regard, physical security is not that significant when protecting financial investments.
Because many hedge funds systems get designed to work only with structured data, Agio’s opinion is that the hedge funds cybersecurity is robust and hard to penetrate. Structured databases come with clear terms. For example, position and trades. As a result, protecting them becomes easy. For unstructured databases that can easily get manipulated or replicated by the cybercriminals, Agio offers solutions. Private equity firms contain most of the unstructured data. When hedge fund managers branch out to establish their own private equity firm they need to do their due diligence in cybersecurity fitted for their specific needs. Agio offers advice to burgeoning entrepreneurs on how to start a private equity firm on cybersecurity matters. It is easy to manipulate simple unstructured documents like Excel Spreadsheets, Microsoft Word, and PowerPoint slides. The fact that structured data is more secure than the unstructured data is common knowledge.