Case Studies

Risk Management

An online investment platform offered its investors access to a range of actively managed investment funds selected by its fund selection team.

The team lacked both resources and tools to deliver the level of service to which they aspired including the level of coverage, selecting the best funds and ongoing risk management to provide an early warning signal if a fund began to perform differently than expected or if the manager’s alpha generating skills were unsuited to the current environment and therefore expected to deteriorate.

Parala worked with the client to identify the areas of their fund selection proposition that they wanted to strengthen and used AlphaPredictor® to deliver the following:

  • Enhanced risk management and ongoing monitoring with forward-looking analysis of fund universes with the highest client asset exposure
  • Improved fund coverage and buy lists for important asset classes and provided a powerful system for fund research that allowed the team to use their resources more efficiently
  • Created a 1-month and 3-month ahead early warning signal to identify funds whose performance and alpha generating skills were showing signs of deterioration relative to their peer group

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