Historical & Ongoing Performance Evaluation


Historical Performance Evaluation

Once a client has finalized a strategic target asset mix and affirmed a comprehensive investment policy, their current investment management team should be reviewed in light of its capabilities to successfully implement the new investment plan. When evaluating the current efficacy of each existing investment manger or fund, many traditional performance evaluation tools are used (index comparisons, universe rankings, etc). Beyond this, Chartwell looks closely at the following attributes in assessing the current management team:

  • Consistently favorable returns versus peers and relevant benchmarks. We look at return patterns over rolling one-, three-, and five-year timeframes to evaluate the consistency of returns. We seek to eliminate “one hit wonders” through this process.

  • Disciplined and repeatable investment process. Our clients deserve to understand, in very specific terms, how assets are managed and returns are generated. They should have confidence a successful investment pattern can be replicated.

  • Avoiding redundancy in the composition of the investment team. For clients that have multiple managers, we strive to structure a team that compliments one another and maximizes diversification benefits.

  • Experience and integrity of the investment team. To reduce our client’s implementation risk, we only want to work with honest organizations. Naturally, we expect the people who generated the attractive track record to still be managing the assets.

  • Superior risk-adjusted returns. We expect to easily observe the positive impact of superior risk controls on client portfolios. When combined with consistently good investment performance, the result is superior risk-adjusted returns. This makes an existing management firm an attractive choice for retention.

  • Superior communications and support for clients and consultants.


Ongoing Performance Evaluation and Analysis

Performance evaluation is an ongoing process, not an event. Performance should be evaluated on a quarterly basis to ensure each manager is adding value and successfully implementing its “share” of the investment strategy. Chartwell’s performance reporting system has the capability of analyzing manager and portfolio performance many different ways. In our customized reports for clients, we review the client’s asset structure, any rebalancing requirements, provided performance attribution on individual managers, and recommendations for any changes that may be warranted. Our goal in performance evaluation is to interpret, rather than merely provided data. The interpretation turns a performance report into a valuable fund management tool, not just a piece of documentation. 

In a typical client report we provide:

  • Quarterly, year-to-date, calendar, and trailing period comparative returns
  • Custom Index comparisons and Custom Universe rankings
  • Comparisons for up to two added custom objectives (e.g., comparisons to CPI, nominal rates of return, additional index comparisons, etc.)
  • Up and Down Market Cycle Performance analysis
  • Performance Attribution analysis (e.g., analysis of a manager’s asset allocation and security selection skills)
  • Risk Analysis
  • Market Value and Cash Flow Summaries

Regular performance review meetings take place quarterly or as needed by the client, based on staff or committee preferences.


Files coming soon.