Consulting Services
Asset Allocation and Asset/Liability Analysis
Establishing an optimal asset allocation policy is the single most important decision made by an investor. We work closely with clients to review the array of investable asset classes, both public and private, to identify these which might result in the optimal combination of risk and return for the portfolio. We use proprietary risk, return and correlation assumptions to assess the expected risk and return of different asset mixes over a wide variety of market environments.
We conduct asset/liability analyses to enable investors to identify the asset allocation policy that best meets their liabilities. In this process, we define the universe of available asset classes, develop risk, return and correlation analyses for all asset classes, and project the liabilities of the plan. All of this is done taking into consideration any specific preferences or constraints, including maintaining a target funded ratio.
We employ state of the art tools to develop efficient portfolio mixes. We utilize a Monte Carlo portfolio optimization process, known as resampling, to forecast risk and return inputs over a wide range of scenarios. This process allows us to arrive at optimal allocations that are both robust and intuitive and which project the impact of various market environments on expected pension expense, contribution and funded ratios.
Investment Structure Design
Investment structure design defines the strategies which are used to implement the asset allocation policy. We work with clients to select among a wide variety of active, enhanced, and passive strategies, paying close attention to incremental costs and risks contributed by these strategies. Our goal is to add net of fee return through the selection of different strategies at an appropriate level of active risk. We identify these strategies which have the highest probability of improving upon the expected risk and return characteristics of a fully passive portfolio.
Manager Search and Selection
We conduct more than 1,200 meetings with investment managers annually. We utilize a wide variety of databases to access information about managers across all public and private asset classes. Our investment manager research team, consisting of full-time experienced professionals is focused on monitoring our clients' current investment managers and identifying new candidates. We utilize a mixture of quantitative and qualitative analysis to review a manager's organizational stability, investment process, compliance procedures and historical performance to identify those managers and strategies which are best matched to our clients' risk and return expectations and are most likely to add value on a forward looking basis.
Performance Monitoring and Risk Analysis
The objective of performance monitoring is to review an investment program's risk and return experience over different time periods. Monitoring the investment structure over time enables investors to confirm whether current strategies and managers are meeting expectations, that the total portfolio continues to be adequately diversified and whether the risk characteristics of the portfolio are appropriate. We analyze sources of over and under performance using state of the art analytics. Our open architecture allows us to access whatever systems best meet our clients' needs. All of our reports are customized for each client.
Alternative Investments Consulting
Our dedicated alternatives research professionals evaluate, construct, and monitor investments in private equity, real estate, and hedge funds. We work with our clients to invest broadly across these asset classes to achieve both improved diversification and incremental return. We advise more than $9 billion in alternative asset investment programs.
Defined Contribution Consulting
We assist clients with the design, implementation, and monitoring of their defined contribution plans. From record keeping searches to investment option design and fund selection, we work closely with our clients to develop investment programs which enable plan sponsors to offer participants well diversified portfolios with appropriate risk and return characteristics.
Our focus is on assisting plan sponsors fulfill their fiduciary responsibilities and implement programs and policies to improve participation rates, reduce expenses, and optimize the mix of investment options for participants.
Financial Intermediaries Consulting
We work closely with fund sponsors to develop model asset allocation portfolios, construct investment programs and select mutual funds, separate accounts managers, and sub-advisors for distribution to the retail and institutional market. Our selection process considers all of the criteria unique to a fund sponsor, including maintaining the level of trust between the fund sponsor and their clients.
