Investment risk and simulation analytics for endowment portfolios with a focus on spending requirements and achieving mission objectives.
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An in-house investment team or CIO can leverage the resources of PFaroe to provide a powerful framework within which performance can be optimized while managing the impact of downside risk on an endowment’s corpus and spending needs. Depending on how the organization measures success, a risk framework can be defined in terms of objectives relating to spending goals, portfolio real value and performance relative to a policy portfolio, among others.
CIOs can test policy portfolios and optimize fund strategies and managers, employing a number of techniques from “What if?” scenario testing through to powerful stochastic modelling using a sophisticated economic scenario generator.
Alternative investments are included for a holistic view of the portfolio. Multiple types of spending formulae are built in, which, together with the asset inputs, automatically produce a comprehensive suite of spending, asset and risk analytics, allowing CIOs to test investment solutions from multiple perspectives. Developments in technology and methodologies since the financial crisis allow PFaroe to offer sophisticated modeling that was previously beyond the reach of only the largest endowments and foundations.
CIOs are empowered through real-time analysis, allowing them to react far quicker to investment opportunities and market dislocations. Strategic plans can be evaluated and implemented to deal with different market events.
For example, in the event that the endowment’s value or spending falls below a certain level, PFaroe can help map out the best investment strategy going forward.
PFaroe is nimble and interactive, providing the CIO with a competitive advantage over peers, strengthening the value proposition of the in-house team.
PFaroe’s regular, easy-to-access analytics allow CIOs to monitor and report on their investment portfolio and risk efficiently and effectively. Asset allocation exercises become less cumbersome. Seamless ex-ante analytics can be applied to test new managers or fund strategies. Monitoring and reporting on portfolio risk and spending implications can be performed more frequently and seamlessly.
PFaroe’s reporting capabilities are powerful and comprehensive, providing a potential platform for front-to-back reporting needs. PFaroe can generate impressive tailored reports for monthly/quarterly Board reporting requirements, on-demand and at the click-of-a-button.
PFaroe shows the likelihood of endowments or foundations delivering on their mission through deterministic and stochastic projections of their portfolio’s spending contribution to the organisation’s budget.
The CIO is empowered by illustrating the direct impact of investment decisions on these financial goals. Gifting patterns and capital campaigns can be incorporated to provide the organisation with more confidence in budgeting and mission delivery.
Disparate systems and services can be rationalised through implementation of PFaroe, saving time and money, while manual intervention is eliminated, improving security and minimising the risk of errors.
A snapshot of the endowment or foundation’s portfolio value, asset allocation and risk attributes – key information for all stakeholders.
Monitor portfolio holdings and assess the impact of changing market conditions.
Analyse risk attributes and align the investment portfolio with risk and return objectives.
Perform powerful forecasting of portfolio value and the endowment’s spending contribution to the organisation. Analyse the impact of highly customisable investment strategies over time.
Model and maintain custom asset classes – from public funds, ETFs, and alternatives including hedge funds and private equity.
Instantly create client-ready PowerPoint or Excel templates.