Recently, SAA brought on a new health insurance client that worked with several external investment managers within fixed income and equity asset classes. Upon hiring, SAA completed an extensive analysis of these managers to determine if any changes were necessary over the short term. This analysis included:
o Site Visits and/or Conference Call Reviews
o Solicitation and Analysis of Updated Database Submissions by Managers
o Analysis of Historical Performance, Portfolio Structure and Risk Profile
Right out of the gate, SAA worked with the client and one of the fixed income managers to reduce their fee by more than 50%. The manager had offered a reduction, but only in exchange for a change of objective. The client had not acted on this until SAA reviewed the proposal and confirmed that the change in strategy would not materially impact their approach or result in a large degree of costly portfolio turnover.
Simultaneously, SAA completed a review of this manager and determined that their track record to date, combined with organizational changes warranted potential replacement. As such, SAA quickly orchestrated a fixed income search using data in its proprietary online and presented a summary search to the client’s senior staff and a small group of finalists to the Board level Committee. Finalist interviews will follow at which time a decision will be made on whether to replace the existing manager.
SAA’s size and lack of bureaucracy enables the company to act quickly to address any specific needs of its clients. Automated research resources such as the Manager Select database, provide constant access to information on the fixed income managers who manage the bulk of insurer’s assets.