Risk Management
At Alternative Investment Group, we consider risk management to be a critical and integral part of the investment process. We focus on three levels of risk management: at the underlying manager level, at the portfolio level, and within our own organization.Our risk management process includes continuous review of areas including:
- Portfolio analysis of strategy, structure, types of trades, region, sector, and capitalization exposures
- Organizational factors – governance, management, reputation, qualifications, compensation structure, capacity
- Operating procedures and processes – trading, cash movement, valuation, accounting, reporting, servicing, and contingency planning
- Resources – human, capital, and technology
- Third party vendors – prime brokers, custodians, administrators, auditors, and legal counsel
- Reference and background checks
- Regular telephone updates and in-person visits
- Quarterly quantitative analysis of performance, market exposure, correlation, volatility, reward-to-risk ratios at manager and portfolio level
- Close review of audited financial statements and K-1s for consistency with expectations and guidelines
