Capture the impact of decisions at each stage of the investment process for multi-asset portfolios using a top-down attribution model.
Ortec Finance utilizes a proprietary, decision-based attribution model to help asset owners understand the key drivers of differences between actual and benchmark returns, implementation versus strategy.
The backbone of the approach is the ability to model the Investment Decision Process (IDP), integrated into PEARL – our performance measurement and attribution solution. This model enables total fund attribution for multi-asset portfolios across all decision layers, including tactical and operational deviations from strategy, exclusion policies, implementation drift, and manager or stock selection.
Pioneered in collaboration with a major Dutch pension scheme in 2000, our model offers a top-down alternative to the widely used Brinson models, reflecting today’s real-world investment decisions within an asset owner's operating framework.
Why use PEARL’s decision-based attribution to analyze investment decisions?
Measure each decision’s contribution to the total fund performance by using a top-down approach that reflects the decision hierarchy
Help identify all explicit and implicit decisions within your Investment Decision Process
Capture the effectiveness of overlay and derivative strategies, across all asset classes
Thoroughly analyze portfolio returns against currency movements and hedging by combining with our proprietary currency overlay attribution
Obtain the full fund picture when used in combination with traditional attribution models for individual mandates (equity, fixed income, private assets)
Accessing decision-based attribution in PEARL
Our decision-based attribution model is integrated into PEARL, where fund hierarchies can be configured to reflect your unique investment decision process (IDP). PEARL enables asset owners to explain the performance of investment strategies independently from their implementation, by modeling various strategic, tactical and operational decisions as well as overlay strategies using appropriate benchmarks or reference portfolios.
Integrating with currency overlay attribution and asset class attribution
On a single platform PEARL combines our proprietary decision-based attribution, currency overlay attribution and asset class specific (bottom up) attribution methodologies. This allows users to slice and dice the fund to their needs. All analytics are based on the same consistent dataset to create a valuable and undisputed feedback loop.
About PEARL
PEARL is Ortec Finance’s established performance measurement and attribution solution. It helps asset owners, asset managers and fiduciary managers to obtain deep insights through decision, currency, multi-asset, equity, fixed income and factor attribution models.
It combines proprietary decision and currency overlay attribution models with flexible and time dependent fund and benchmark hierarchies to calculate the added value of each investment decision. Its comprehensive analysis contributes to a feedback loop that enhances the overall investment decision framework.
Contact
Elske van de Burgt
Managing Director Investment Performance
Stefano SJ Lee
Managing Director - Asia Pacific