Northern Trust Issues Transition Management Analysis

October 27, 2009 ( - Northern Trust has introduced a new pre-trade analysis report for transition management designed to help institutional investors evaluate the potential costs and risks of switching investment managers or changing asset allocation policy.

Northern Trust’s pre-trade report includes a number of risk metrics, including 20-day performance comparisons of target and legacy portfolios, industry sector analysis, a corporate earnings announcement calendar for relevant securities, and a summary of trades by time zone for global portfolios, according to a press release.

It also details the full cost of a transition, including explicit costs such as fees, taxes and trading commissions, as well as implicit costs like bid-offer spreads, market impact, and opportunity cost as a security price moves over time

“While clients sometimes select a transition manager based on the lowest estimated costs, we believe the goal of a pre-trade report should be to provide a reliable assessment of the risks and costs associated with a transition event,” said Ben Jenkins, a senior strategist in Northern Trust Transition Management, in the announcement. “Our new report provides a more comprehensive view of the potential risks when trading assets, enabling us to deliver a customized solution that seeks to achieve the target portfolio exposure on a timely basis.”

Over the past three years, Northern Trust Transition Management has managed more than 1,200 transition events, with a total value in excess of $160 billion.

More information about Northern Trust is available at .