Performance

Growing Interest for Asset Owners to Claim Compliance with the GIPS Standards

The popularity and worldwide adoption of the the Global Investment Performance Standards (GIPS®) by investment management firms is largely due to demand by asset owners. In the interest of risk management, asset owners increasingly require external investment managers to comply with the GIPS standards. Recently, more asset owners have begun to apply the same principles to their own performance reporting and ACA Performance Services is seeing growing interest in attaining GIPS compliance among the asset owner community. 

White Paper: A Practical Guide to Implementing the GIPS Standards

Compliance with the GIPS® standards is recognized as an industry best practice and has become a de facto requirement, especially in the institutional money management space, in order to stay competitive. A firm’s claim of GIPS compliance facilitates “apples-to-apples” comparisons between investment managers for prospective clients and fosters invaluable client trust.

Is Asset-Weighted Dispersion Right for Your Firm?

A GIPS®-compliant presentation contains a number of required statistics. One such metric is the internal dispersion of individual portfolios within a composite. The GIPS standards do not prescribe a specific methodology (as long as the measure that is selected is applied consistently) and thus many firms struggle with this calculation. The following is a best effort attempt at explaining one option: asset-weighted standard deviation. 

Market Exposure: The Importance of a Comprehensive Compliance Review

In 2002, the Sarbanes Oxley Act was enacted to augment the regulation of accounting and disclosures for public companies. This was in direct relation to aggressive accounting methods, the technology bubble, and other instances of corporate malfeasance. The ensuing financial crisis and market crash of 2007-2009 uncovered a lack of oversight exhibited by numerous Ponzi schemes, as well as negligent lending practices in the real estate mortgage market.

A New Trend in Platforms Requiring Third-Party Performance Attestation

Consultant database reporting is an important business consideration for many investment management firms. The databases serve as a gateway for investment managers to reach institutional and retail assets alike. A recent trend in the industry is that of increased due diligence. The top databases are increasingly requiring firms to meet one of the following requirements: