You’ve read it in the fine print – “past performance may not be repeated.” This is true of investment returns, as well as the investment managers themselves.
Portfolios are only as good as the people who manage them. That’s why we develop a thesis for each manager, explaining why its decision-making skills and processes are superior, as well as providing specific triggers for that manager’s reevaluation. Each thesis is peer reviewed and approved before a manager is hired.
We believe this level of proactive due diligence differentiates us from our competitors.
In addition to explaining the relevant factors behind a manager’s performance, our forward-looking expectations include how a manager will:
- Execute a given investment mandate
- Define environments in which the strategy is likely to outperform or underperform
Why multiple managers?
You want managers who focus on their best investment ideas. Specialist managers know where to seek opportunity in their areas of expertise, and generally recognize favourable and unfavourable market changes. We combine these managers to develop strategies across asset classes. By combining specialist managers, we can create a potentially more competitive product relative to benchmarks because:
- Managers with differentiated processes provide diversification benefits and potentially provide reduced volatility
- We feel they provide a competitive advantage, and their styles complement one another
- We can identify the most appropriate number of managers needed to gain exposure to a breadth of alpha source opportunities
- We capture the skill of each manager within each area of expertise
Disciplined monitoring. Timely changes. Seamless process.
Staying on top of – and reacting to – change requires continual attention. One of the biggest drags on investment returns can be the length of time it takes to implement change once a manager concern is identified.
We don’t have to wait for poor performance to remove managers; we do it when we believe they have lost their competitive advantage. We have our ear to the ground, conducting daily, monthly, quarterly and annual research and analysis of manager activities and performance within each asset class. When the time comes to make a change, we’re ready.