Manager Of Managers proprietary fund selection process

Exposure To More Fund Families Many fund families have a good fund - no family has all the best funds. More choices for us creates more opportunities for you.

Modern Portfolio Theory calculates how much we need to put into each asset class box, but we still need to determine which fund to use in representing each category. In order to do this, we have developed a Proprietary Fund Selection Process to choose high quality funds that project to stay at the top of their class. Since we have access to hundreds of fund managers and thousands of individual funds from which to choose, our options are almost limitless5.

All Available Funds in Database

Determining which fund will represent each asset class is a complicated process involving a multitude of steps. Each step narrows the field to isolate those funds that we feel are superior in each category. We start by identifying all funds that are available for investment, or "The Mutual Fund Universe".

Segregate Funds by Asset Class

If we needed to identify a Large Cap Value Fund, we start by segregating all of the funds that specifically fit into that asset class. This allows for a level comparison base among common statistical measurements.

Identify Well-Established Funds

Our process then eliminates any funds that do not have a history of more than 10 years. This removes funds with information that is not sufficient to allow an accurate determination of principles or to verify consistency of approach.

Proprietary Weighting System

Remaining funds are then put through a performance filter, starting with those in the top 10% of their category over the last 3, 5, and 10 year periods. This isolates the top 10 funds which are then put through our proprietary weighting system. Here they compete against each other across various risk, performance, and operational measurements to provide the 3 highest rated choices.

The Winner

The remaining 3 funds are then evaluated to determine which works best in concert with the existing funds in our model portfolio to synergistically add value.