Optimize fund selection with a rigorous multi-manager process focused on objectives, performance, strategy, and ongoing monitoring.
1
Determine investment policy and objectives
2
Conduct analysis on potential managers
3
Review managers' historical performance
4
Conduct initial screening of managers
5
Evaluate managers' investment process and strategy
6
Review managers' risk management process
7
Analyze the managers' team composition and experience
8
Initiate due diligence process for shortlisted managers
9
Conduct onsite visits and interviews
10
Evaluate managers' reporting and operational capabilities
11
Approval: Due Diligence Report
12
Prepare draft proposal for fund selection
13
Approval: Investment Committee
14
Document the selection decision and rationale
15
Negotiate fees and contracts with selected manager
16
Approval: Legal Department
17
Transition assets to the selected manager
18
Monitor and review manager performance on an ongoing basis
Determine investment policy and objectives
This task involves defining the investment policy and objectives for the fund of funds. It sets the direction and guidelines for the fund's investment strategy. The outcome of this task will serve as a roadmap for the entire selection process. What factors need to be considered when determining the investment policy? How will these objectives align with the fund's goals? What challenges might arise when defining the policy, and how can they be addressed? The required resources for this task include market research data, financial analysis tools, and input from key stakeholders.
1
Market volatility
2
Regulatory changes
3
Limited investment opportunities
4
Lack of consensus among stakeholders
5
Inadequate risk management
Conduct analysis on potential managers
In this task, you will analyze potential managers for the fund of funds. The analysis will focus on their track record, investment strategies, risk management processes, and team composition. The objective is to identify managers that align with the fund's investment policy and objectives. What criteria should be used to evaluate potential managers? How will their investment strategies be assessed? What resources or tools will be required for the analysis? The outcome of this task will be a shortlist of potential managers for further evaluation.
1
Performance history
2
Investment philosophy
3
Risk management practices
4
Team expertise
5
Fees and expenses
1
Financial statements
2
Investment performance data
3
Industry research reports
4
Internal investment analysis software
5
Risk assessment models
Review managers' historical performance
This task involves reviewing the historical performance of potential managers. It is important to assess their track record over different market conditions and time periods. The analysis should consider factors such as returns, risk-adjusted performance, and consistency. How will you evaluate the managers' historical performance? What benchmarks or metrics will be used? Are there any challenges in interpreting historical performance data? The outcome of this task will provide insights into each manager's ability to generate consistent returns.
1
Returns
2
Risk-adjusted performance
3
Consistency
4
Volatility
5
Drawdowns
Conduct initial screening of managers
In this task, you will conduct an initial screening of the shortlisted managers. The screening process involves assessing their qualifications, reputation, and suitability for the fund of funds. How will you screen the managers? What criteria will be used? Are there any specific red flags to watch out for? The outcome of this task will be a refined list of managers for further evaluation.
1
Experience in fund management
2
Track record
3
Reputation in the industry
4
Alignment with investment policy
5
Client references
Evaluate managers' investment process and strategy
In this task, you will evaluate the investment process and strategy of the shortlisted managers. The evaluation should assess factors such as the clarity of the investment process, the alignment of the strategy with the fund's objectives, and the track record of executing the strategy. How will you evaluate the investment process and strategy? What are the key considerations? Are there any potential pitfalls to watch out for? The outcome of this task will provide insights into each manager's ability to generate consistent returns.
1
Clarity of the investment process
2
Alignment with fund objectives
3
Execution track record
4
Risk management framework
5
Adaptability to changing market conditions
Review managers' risk management process
This task involves reviewing the risk management processes of the shortlisted managers. The analysis should assess the effectiveness of their risk controls, risk monitoring systems, and contingency plans. How will you evaluate the managers' risk management process? What are the key components to consider? Are there any challenges in assessing the effectiveness of risk management? The outcome of this task will provide insights into each manager's ability to mitigate risks.
1
Risk controls
2
Risk monitoring systems
3
Contingency plans
4
Stress testing
5
Scenario analysis
Analyze the managers' team composition and experience
In this task, you will analyze the team composition and experience of the shortlisted managers. The analysis should assess the expertise and stability of the team members, as well as their ability to execute the investment strategy. How will you analyze the managers' team composition and experience? What are the key considerations? Are there any potential challenges in evaluating the team? The outcome of this task will provide insights into each manager's ability to deliver consistent results.
1
Expertise of key team members
2
Stability of the team
3
Track record of executing the investment strategy
4
Succession planning
5
Collaboration and communication within the team
Initiate due diligence process for shortlisted managers
This task involves initiating the due diligence process for the shortlisted managers. Due diligence is a thorough investigation of the managers' background, operations, and compliance with regulations. How will you initiate the due diligence process? What aspects will be covered? Are there any specific documents or information required? The outcome of this task will be a comprehensive due diligence report for each manager.
1
Background check
2
Legal and regulatory compliance
3
Investment process review
4
Operational due diligence
5
Counterparty risk assessment
Conduct onsite visits and interviews
In this task, you will conduct onsite visits and interviews with the shortlisted managers. The purpose is to gain deeper insights into their operations, investment processes, and risk management practices. How will you conduct the onsite visits and interviews? What questions or topics will be covered? Are there any specific documents or information required? The outcome of this task will provide firsthand information about each manager's capabilities.
1
Investment process
2
Risk management practices
3
Operational infrastructure
4
Team dynamics and culture
5
Client service and reporting
Evaluate managers' reporting and operational capabilities
This task involves evaluating the reporting and operational capabilities of the shortlisted managers. The evaluation should assess the quality and timeliness of their reporting, as well as the efficiency of their operational processes. How will you evaluate the managers' reporting and operational capabilities? What are the key criteria to consider? Are there any challenges in assessing their capabilities? The outcome of this task will provide insights into each manager's ability to deliver accurate and reliable information.
1
Quality of reporting
2
Timeliness of reporting
3
Accuracy of valuations
4
Efficiency of trade execution
5
Operational resilience
Approval: Due Diligence Report
Will be submitted for approval:
Determine investment policy and objectives
Will be submitted
Conduct analysis on potential managers
Will be submitted
Review managers' historical performance
Will be submitted
Conduct initial screening of managers
Will be submitted
Evaluate managers' investment process and strategy
Will be submitted
Review managers' risk management process
Will be submitted
Analyze the managers' team composition and experience
Will be submitted
Initiate due diligence process for shortlisted managers
Will be submitted
Conduct onsite visits and interviews
Will be submitted
Evaluate managers' reporting and operational capabilities
Will be submitted
Prepare draft proposal for fund selection
In this task, you will prepare a draft proposal for the selection of the fund of funds. The proposal will outline the rationale for selecting a specific manager and provide supporting evidence based on the evaluation process. How will you structure the draft proposal? What key information should be included? Are there any specific formatting or presentation requirements? The outcome of this task will be a comprehensive proposal for fund selection.
Approval: Investment Committee
Will be submitted for approval:
Prepare draft proposal for fund selection
Will be submitted
Document the selection decision and rationale
This task involves documenting the selection decision and rationale for the chosen manager. The documentation should provide a clear explanation of why the manager was selected and how their capabilities align with the fund's objectives. How will you document the selection decision and rationale? What key points should be covered? Are there any specific templates or formats to follow? The outcome of this task will be a formal record of the selection decision.
Negotiate fees and contracts with selected manager
In this task, you will negotiate the fees and contracts with the selected manager. The negotiation process should aim to establish mutually beneficial terms and conditions that align with the fund's budget and objectives. How will you negotiate the fees and contracts? What are the key considerations? Are there any specific legal or compliance requirements to address? The outcome of this task will be finalized fee structures and contracts.
Approval: Legal Department
Will be submitted for approval:
Document the selection decision and rationale
Will be submitted
Negotiate fees and contracts with selected manager
Will be submitted
Transition assets to the selected manager
This task involves transitioning the assets to the selected manager. The transition process should ensure a smooth transfer of assets while minimizing disruption to the fund's operations. How will you transition the assets? What steps or procedures will be followed? Are there any specific legal or regulatory requirements to comply with? The outcome of this task will be successfully transferred assets under the management of the selected manager.
Monitor and review manager performance on an ongoing basis
In this task, you will establish a process to monitor and review the performance of the selected manager on an ongoing basis. This includes setting performance benchmarks, conducting regular performance reviews, and addressing any issues or concerns that arise. How will you monitor and review the manager's performance? What performance benchmarks will be used? Are there any specific reporting or communication requirements? The outcome of this task will be a structured monitoring and review process for the selected manager.
