Insights that Identify and Manage Risk

Service Providers

Identify and Manage Risk

Profile of Client

$60BN Public Pension Plan.

Challenge

The plan was looking to improve the quality and efficiency of its pre and post operational due diligence and monitoring processes covering 120+ single manager investments.

Solution

Convergence Complexity Profiling Service™ was implemented to identify and push daily risk changes and insights covering using Convergence’s Complexity Factors™.

Results

The service was rolled out to 25 Investment, Risk Management, and Operational Due Diligence professionals in a customizable personal news page and expanded to include pre-investment due diligence on potential investee managers and the use of a Convergence Analysts to examine changes in risk factors using the Convergence Risk Management Workflow.

Profile of Client

$500bn Fund Administrator.

Challenge

The number of terminations the client experienced was greater than plan and they wanted to develop an early warning system to alert them to conditions that lead to terminations.

Solution

Convergence Clients at Risk™ is a predictive analytic that was developed from our study of over 10,000 termination decisions made by 6,000 Managers over a 10-year period.

Results

The client conducted a two-year test by identifying the Top 100 riskiest clients based on their internal analysis and Convergence’s predictive analytics. After two years, 40% of Convergence clients at risk terminated their contracts, which was 4x higher than internal estimates. The client adopted our client at risk signals to provide independent insights to their client management teams.

Profile of Client

$28bn multi-strategy Hedge Fund Manager

Challenge

The firm was looking to open their flagship fund to new investors and was told that their expense disclosures were “off-market.”

Solution

Convergence Fund Expense Analyzer™ scores the clarity, consistency and conciseness of expense disclosures versus the market and/or peer group. We identified multiple opportunities to improve the consistency and completeness of Form ADV expense disclosures.

Results

The adviser amended their LPA and raised $10bn in AUA over the next two years.