Our Investment Philosophy:

Our philosophy unites four key investment cornerstones to provide improvement and consistency to your insurer or risk pool's investment program.

Investment Process

• Asset allocation drives the great majority of returns based on historical studies
• Accountability & Transparency is key within the overall process
• We work with the entire “Investment Process Value Chain” to create and build value for insurance companies and risk pools:
  Allocate >>   |   Policy >>   |   Implement >>   |   Monitor >>   |   Measure >>   |   Peers >>

Active Management for Fixed Income Mandates

• The less efficient nature of the asset class due to its over the counter structure
• The necessary customization involved in managing fixed income portfolios for insurers or risk pools

Passive Management for Developed Market Equity Mandates

• In general, passive management makes more sense for developed market equity mandates (Large Cap, Mid Cap, Small Cap) due to:
• The greater level of efficiency in these markets
• The higher fees associated w/ managing active equity mandates
• The difficulty in outperforming benchmarks given the fee drag

Generally, Alternatives Have Not Been a Fit for Insurers or Risk Pools

• Alternatives encompasses a wide array of investment options. Some alternatives can be suitable for insurers, especially as the marketplace evolves. However, many alternatives have not been a fit due to:
• The high level of fees
• Potential lack of liquidity
• Agency problems
• Impact to capital ratios

• In certain cases where our clients are very well capitalized and have ample liquidity elsewhere, some alternatives (i.e. real estate, private equity) may be suitable for consideration. In those cases, the accessibility of alternative asset classes is growing through traditional private structures, evergreen funds, and even ETFs. We continually monitor opportunities in the private real estate (equity and debt) and private equity.

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