Selekane Asset Consultants - Our services

By: Selekane  11-11-2011
Keywords: Investment Strategy

Investment policy statements provide a vital framework for investment decisions.
Which is why Selekane consultants work with clients to evaluate and prioritise their investment objectives, and develop a strategy that maximises the probability of achieving these objectives.

An investment policy statement is formulated detailing the guidelines by which the fund’s investments must be planned and supervised. This statement is kept flexible, allowing the trustees to make changes as and when necessary.

While it is important to select the right investment manager, it is also vital to ensure that the manager is following an investment strategy suitable for the fund and its liability profile. At Selekane we utilise the industry’s leading asset liability investment model to analyse how a fund’s assets and liabilities will jointly behave, with varying asset mixes, under different economic scenarios. We are then able to produce a mix of assets referred to as the strategic asset allocation, appropriate to the specific liabilities of the fund and stated objectives. This is key, as research reveals that asset allocation contributes over 90%  to the variability of returns.

Throughout this process, our consultants work closely with the funds' actuary as well as the Trustees. They provide a detailed explanation of the investment vehicles available and their associated risks, as as well as information on the expected return levels, risk and taxation (where applicable) of individual asset classes, and details of legislative requirements and restrictions.

At Selekane, asset manager research is a core activity, which is why we maintain a comprehensive database of investment managers for a wide range of institutional mandates and products. Our investment manager research, due diligence, and selection process utilises several layers of quantitative and qualitative screens to identify managers most likely to perform well in future.

Independent risk, performance and compliance monitoring is crucial for unbiased analysis of the performance of the fund as well as that of investment managers. We pay particular attention to risk rather than past performance to ensure that trustees know what lies ahead as opposed to what has happened in the past. We focus on analysing the actual assets (domestic or international) that managers buy into their portfolios rather than the aggregate returns that have been achieved. This allows for the proper understanding of risk associated with each asset in the portfolio.

In order for trustees to be confident that they are making the right decisions, they need to have a thorough understanding of the tasks that they are delegating. Selekane offers comprehensive training programmes to trustees covering a diverse range of topics. These include the principles of investing, risk management, investment strategy formulation and monitoring, and asset manager and product selection. This training helps trustees to make confident, fully-informed decisions when it comes to managing their fund’s assets.

Selekane offers member education programmes that are tailored for each fund. These enable members to have a full understanding of the implications of their fund selections and the risks of the various asset classes in which they may choose to invest. Our member communication services include: preparing detailed fact sheets on each of the fund options (including structure, risk, suitability and performance), investment newsletters for members and regular performance updates.

In the event that trustees decide to change the investment strategy and replace an investment manager, the transitioning of assets to a new manager poses a challenge given the number of parties involved. Selekane assists trustees with the appointment and acts as a liaison with the appointed transition manager to ensure that the transfer is carried out in a cost-effective and timely manner.

Keywords: Investment Strategy