A Russell news release said its aggregate exposure management approach is designed to deal with issues such as:
- portable alpha structures that result in redundant trades;
- private equity investments that create unintended exposures associated with capital calls and distributions; and
- liability hedges that generate significant cash flows that disrupt the overall asset allocation of the fund.
According to the announcement, the aggregate exposure manager plays a key role in the consideration and implementation of new investment strategies and also for those investors making significant adjustments to their asset allocations.
The aggregate exposure manager can provide institutional investors with improved fiduciary oversight, a mechanism to earn administrative alpha through implementation efficiencies, and a platform to capture the early-adopter’s advantage associated with new investment strategies, Russell said.
“An unprecedented onrush of new investment products and strategies have resulted in portfolios that are more complex than ever before, with increased odds of a performance gap between paper portfolio and realized results,” said Michael Thomas, Chief Investment Officer, Russell Implementation Services, in the news release. “There is an increasingly visible cost associated with the delay between identifying a strategy and getting it into the portfolio, and Russell believes that an aggregate exposure manager makes it possible to act more quickly and efficiently.”
More information can be found here .
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