TRANSITION MANAGEMENT SERVICES
Avior offers Transition Management services to a wide range of clients, including multi-managers and investment consultants. Transition Management entails implementing changes to the investment structure of a fund, where large amounts of trading in financial securities are involved, spanning shares, bonds, derivatives, money market instruments and foreign exchange. Typical fund restructuring events include:
- Changes in fund managers
- Changes in asset allocations, such as rebalancings
- Large inflows or disinvestments
- Changes in benchmark
- Introduction of passive components into the investment structure
- Member choice implementation
- Move of retirement fund assets to umbrella funds
- Merger of pension funds
Avior’s Transition Management service offering has one main goal: to implement portfolio changes at the lowest possible cost, and risk, to the client, so that the restructuring event impacts least possible on long-term fund performance. Together with project management of all related activities, by coordinating all moving parts between various stakeholders, the workload burden on the client is reduced, providing peace of mind that the project is progressing smoothly, and within required timelines.
Services include:
- Trade execution
- Trade settlement
- Cash management
- Cost minimization and cost tallying
- Tax considerations and minimization of tax charges
- Risk management, by managing events that could impact negatively on fund performance
- Maintaining market exposure when asset transfers are done in cash, via use of derivatives
- Project management, to meet budget and timeline constraints
- Detailed reporting, including pre-trade and post-trade reports
- Transparency of restructuring costs, via Implementation Shortfall analysis
- Fund administration offered during transition project, to avoid admin gap
- Obtaining regulatory approvals on behalf of the client
- Opening of bank accounts (including offshore)
Value offering:
- Discounted brokerage rates
- Best execution on trades
- Cost reduction: “what gets measured gets managed”
- Lower Implementation Shortfall and impact on fund performance
- Risk management: chances of unfavorable outcomes greatly reduced, to ensure consistent results
- Legwork done: go-to for ad-hoc requests
- Project management: coordinating of activities between stakeholders
- Regular progress updates
- Accountability: responsibility taken for impact of errors and inaccuracies
- Peace of mind during complex fund restructurings
- No conflicts of interest
- Full transparency
- Seamless fund administration
- Full audit trail
- Continued support: even after projects have ended; requests and enquiries welcome