Balancing Art and Science: Returns & Benchmarking Processing for Asset Owners

In the first paper of our asset owner series, we explored the unique business drivers, valuation methodologies, and considerations for private market and external manager processing. Now, in our second installment, we shift our focus to returns and benchmarks.
Asset owners often invest across a diverse mix of private and public market asset classes. But should the same return methodology be applied to both the asset class and the total fund level? Are there acceptable deviations?
Sophisticated benchmarking capabilities are essential for accurately consolidating returns at the total fund level. The complexities of substitution and benchmark specific overrides present challenges driven by various underlying factors. What are these factors, and how can best practices help overcome these challenges? Read on to discover our perspectives and practical solutions

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UAT for Performance Transformations Is Notoriously Difficult. It Doesn’t Need To Be.

User Acceptance Testing (UAT) can throw projects into a frustrating and mind-numbing stall, which is catastrophic to any transformation. The terror of botching a go-live event with insufficient data commonly leads users into a frenzy of checking, double-checking, approving, re-checking, and reapproving. As the process repeats across test cases, progress toward user confidence seems negligible.

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Reap More Value From Data in Operational Transformations

“SURROUNDED BY DATA, BUT STARVED FOR INSIGHTS.” – JAY BAER LEVERAGE CAPABILITIES AVAILABLE IN EMERGING CONVERSION TOOLS TO SUPPORT PLANNING INSIGHTS In the first paper, we said that Performance is Data, sometimes a daunting data challenge. Performance data generation happens in successive layers. Aggregation of holdings creates exposures; changes in market values or exposures create returns; returns lay

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Attribution for Asset Owners

While much has been written about attribution in the context of individual asset classes, the asset owner confronts a much more complex scenario. In the interest of maximizing return/risk payoff (often subject to external mandates, liability streams, and risk constraints), asset owners frequently diversify their total fund amongst multiple asset classes: equity, fixed income, hedged

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Solving for Scale: Thought Leadership Webinar

Ready to unlock the secrets behind achieving remarkable growth while maintaining operational excellence? Join four industry experts for a deep dive into the world of investment operations to find out how asset management firms are navigating the delicate balance between expansion and profitability.

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Natural Allies: Investment Performance and the Data Office

This paper proposes that Investment Performance was (and in many cases, is) the original Data Office where governance issues come to a head. If this logic is true, starting a Data Governance effort with Investment Performance takes advantage of a natural ally already positioned to solve those very problems. This natural alliance may be the most efficient mechanism to understand the strengths and weaknesses of an enterprise’s existing data strategy and potentially advance efforts to resolve them rapidly. Starting with that premise, this paper looks at how a new or revamped data governance program would benefit from either starting at the end of the investment value chain – Investment Performance – or by aligning the Data Office and Investment Performance under the Chief Data Officer (CDO). As many Meradia projects intersect Data and Investment Performance, this paper highlights the synergies and overlap between these functions.

by Laurie Hesketh, CIPM, PMP
Andrew Jacob, CFA

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Solving for Scale: Transforming Investment Operations to Meet Rapid Growth

Meradia’s brand new research paper, “Solving for Scale: Transforming Investment Operations to Meet Rapid Growth,” is now available!

Leveraging insights from a national survey of asset managers about the impact of growth on their firms’ operations, the whitepaper explores:
• How today’s asset management firms are balancing growth and profitability
• Why most traditional avenues for business expansion result in sub-optimal operations
• How achieving efficiency at scale becomes possible through a proven operational framework

by Jonathan Boersma, CFA
Jose Michaelraj, CIPM, CAIA

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Investment Performance Is a Data Management Challenge

Investment Performance transformation projects are notoriously difficult. Why? Investment Performance is, at its core, an enterprise data function in disguise. Its role in enterprise data management is so prevalent that the maturity with which a firm’s Investment Performance function manages this data functions is typically a bellwether for the operational efficiency of the firm generally. Performance and analytics, done well, consume an astounding array of internal, external sources and often a combination of the two. In addition, you’ll be hard pressed to find any department in the firm that doesn’t want to consume its outputs and scrutinize its conclusions. Investment Performance transformations are difficult because they necessarily require evolution for the firm’s enterprise data assets and can impact nearly every department.

by Laurie Hesketh, CIPM, PMP

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A Business Case for Fractional Performance Oversight

The mix of skills required to oversee investment performance includes regulatory compliance, complex mathematical models coupled with data management, and a variety of technologies. Fractional Performance Oversight is the concept of key elements of oversight and leadership being supported by partial allocated resources or fractional outsourcing. In what situations does Fractional Performance Oversight make sense? Jonathan Boersma and Alicia Spencer consider some scenarios which may warrant a different paradigm.

by Jonathan A. Boersma, CFA, Practice Lead, GIPS and Performance Regulation
Alicia Spencer, CIPM, Senior Manager

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