Organisation

A parent company's financial and human resources, the nature of its core investment markets, its culture and, ultimately, its own ownership, can have a significant impact on a multi-manager team's prospects within the wider organisation.

We consider;

Who ultimately controls the company?

How the company is organised, the responsibilities of its senior management team, its lines of reporting and the alignment of staff incentives with the company�s own objectives, its products and its customers� interests.

How the company's business strategy fits with the longer term outlook for its multi-manager proposition.

How the organisation seeks to ensure continuity of business when things go wrong.

Operational / Infrastructure and Support

Larger organisations might have competing calls on operational infrastructure and find it difficult to deliver bespoke systems support to their multi-manager teams. On the other hand, stand alone multi-manager businesses might face different challenges - for example; organising scarce resources efficiently.

We consider;

Access to in-house fund manager expertise, research and marketing.

How information technology is used and its impact on the day to day activities of the multi-manager team.

How efficiently dealing instructions are communicated to the trading team and how cost effectively they are implemented.

Whether operational functions are outsourced, and how trading, accounting and reporting systems are aligned to minimise the scope for errors.

Manager and Team

We believe that people are the most important assets in a multi-manager business.

We consider;

The depth and relevance of experience that members of the team have in managing the types of asset class represented in the fund.

Whether team members act together cohesively and decisively whilst still offering sufficient scope for their ideas to be explored and challenged.

The development of the team and the relevance of compensation benefits in light of each team member's contribution to the investment process.

Investment Scope

The breadth of asset classes and the types of instruments employed in a multi-manager fund are key factors that influence decisions on whether to include or exclude a fund from the selection process.

We shed light on a fund's scope of investment opportunity.

Whilst a fund's stated investment objective(s) provides an outline as to the types of investment one can expect to see, it is often just that; an outline. It might not always accurately reflect the manager's preferred investments or the proportions in which the fund invests in them.

Investment Approach

The investment approach helps to define the boundaries within which the manager makes decisions on; asset allocation, underlying investments, themes and sectors.

We examine;

The implications that the investment approach has for investment risk and style bias.

Whether the methods and sources of research used by a multi-manager team provide it with an information advantage.

How effectively investment decisions are made implemented.

How the approach differentiates the fund and manager from its peer group.

Analysing the Past

Analysing past behaviour provides valuable evidence of the effectiveness of a fund manager's decision making process and market foresight.

We consider;

How effective past decisions have been throughout the different phases of the business cycle.

How strictly a manager is likely to follow the stated investment strategy and under what circumstances it might be deviated from.

What lessons a manager has learned from past experiences and how this might impact on future decision making and investment risk.

Current Positioning and Strategy

Current fund positioning provides undisputable evidence of a fund manager's present thinking and level of conviction in certain markets, instruments and underlying fund managers.

We consider current positioning and strategy in light of the fund's own;

Investment boundaries.

Risk parameters.

Investment objectives.

Performance Expectation

We understand the important role that fund selectors play in managing their clients' expectations.

We explore;

How a fund might be expected to perform in the future.

The flexibility of the manager's process to adapt to evolving market and economic scenarios.

The potential trigger points in future market conditions that might cause fund selectors to reassess their multi-manager fund selections.

Qualitative Risk

We assess 9 potential sources of risk using our unique forward looking qualitative-based approach.

We highlight those that are most relevant to the fund and analyse the controls and procedures in place that seek to mitigate them.

• People Risk
• Concentration Risk
• Investment Strategy Risk
• Investment Risk
• Counterparty Risk
• Liquidity Risk
• Operational Risk
• Product Risk
• Expenses Risk

For more information, please see our Unique Risk Assesment page

Reporting

Timely and accurate investment communications are vital components in the overall multi-manager service proposition.

We examine;

The depth, clarity and transparency of reporting materials.

The correlation of messaging in reporting materials with real investment practice.

How easy it is to access reporting materials and whether they meet the needs of the intended audience.

The frequency and reliability of distribution.

Expenses

Cost can be a controversial subject when it comes to multi-manager funds. We dig beneath the numbers to consider the fund's expenses in light of;

The types of investment in the fund.

The fund's size.

The average level of expenses of other fund's in the peer group.

Appendices

We provide performance tables, charts and any graphical representations mentioned in the main body of the report. We also list the multi-manager funds in scope and provide details of the relevant product features.