Capital Prospects LLC offers both investment management and consulting expertise with regard to emerging managers.In the role of Investment Manager, we offer either Direct Program Management for the client, where we sub-contract with the underlying investment firms, or Program Oversight, where the client maintains the contractual links with the emerging managers. In each of these capacities, the activities of Capital Prospects LLC are largely the same, the distinction being that in a Direct Program Management role it is our responsibility to implement strategy and retain managers, whereas in a Program Management assignment we recommend specific emerging managers and investment program strategy to the client. In both cases, as Investment Manager we work with the client to develop investment parameters consistent with the investment objectives and guidelines and the selected benchmark. Through our investment process we then identify the managers best qualified for inclusion in the investment program and their appropriate weightings. We interface with the custodian and all other parties with administrative responsibilities to ensure ongoing smooth operation of the investment program. We monitor the investment results, reporting regularly to the client, and identify changes we believe will enhance the program going forward.
For clients with existing emerging manager investment programs in place, we will work as a Consultant to provide full program reviews. Our review includes an evaluation of each manager organizationally through our standard due diligence process, an analysis of the managerís style positioning, factor exposures, consistency of portfolio characteristics and appropriateness of the current benchmark, and an evaluation of performance results. Additionally, we analyze the entire investment program in terms of risk posture, style or factor biases relative to the program benchmark, overall performance results and our assessment of the potential contribution of each manager in terms of value added going forward.
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