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Transparent process
All GFIA output is documented in a proprietary decision system, which is transparent to substantial clients.
Manager identification…
• GFIA studies and maintains research on a broad universe of appropriate managers.
• Long history and visibility of its principals means that GFIA has good visibility of new propositions.
• Initial deskwork screens the universe in order to target research time
Manager familiarization…
• Typically 5-20 analyst-hours of face time with the manager, spread over multiple meetings.
• Monitoring of returns and portfolio evolution over 3-24 months
Due diligence…
• A separate activity from manager assessment, conducted immediately prior to an intended investment, to verify all information for accuracy and completeness.
• GFIA’s process is modelled on institutional best practice and focuses on operational and personnel risks.
Portfolio construction…
• GFIA’s portfolios are constructed with risk-weighted position sizing, focusing on drawdown risk rather than volatility, as well as effective diversification, for risk mitigation.
Monitoring...
• Semi-annual manager site visits.
• Modelling of underlying funds’ risk exposure over time
• Immediate portfolio review following exceptional returns (+ve/-ve)
• Due diligence repeated after substantial events
Manager exit
• Impairment of information flow triggers instant redemption
• Movement away from core competences, inappropriate asset size, extended unexplained performance issues, will trigger review and possible redemption
• Tactical positions may be exited at the resolution of the expected event or market development
Disciplined manager assessment
• Assessment process generates 52, mostly qualitative, metrics about each fund emphasis on structure, organization, asset size and growth, and integrity of the manager
• Internally developed database creates a 7-point rating for each fund
• Each fund receives a quantified overall assessment
• The screen acts as a benchmark and evaluation tool to underpin manager and fund selection
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