Northern Trust has expanded its investment risk reporting capabilities to include ex-ante, or forward looking, functionality.
For this release, through a single consolidated report users can see comparisons of risk levels and potential "risk mismatch" alongside the user's managed assets.
"This means that it is possible to look at how investment risks would impact funding levels and the ability of a fund to meet its liabilities over time, as well as how changes in liabilities may open up opportunities to reassess investment decisions," according to the firm. "This aims to aid clients in making informed decisions about more sophisticated liability management solutions. Clients can see at a glance how risks compare between assets and liabilities and understand potential mismatch risks."
Northern Trust has also added active allocation and risk contribution reporting. "This tool can help clients understand the risks associated with deviating from their stated target asset allocation."
Finally, the Chicago-based fund administrator added trend analysis that aims to add context around current risks that exist.
"We believe that these enhancements present our analysis of essential risk information in a clear and actionable format," noted Ian Castledine, global head of investment risk and compliance product for Northern Trust, in a statement. "Equally important, our risk reports, combined with the support of one of our expert consultants, can help create an effective dialogue around the investment process facilitating discussions between asset owners and their chosen investment professionals."
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