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Fiduciary Investment Monitoring
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Fiduciary Investment Monitoring
• Obligation to properly research investments both before and after making them– Apply system of fiduciary mandates which create a
process for selecting investment choices– Regularly monitor performance of each choice– When investment choice fails to measure up to
objective set of criteria, investment must be replaced
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Our Fiduciary Investment Monitoring• 8 Fiduciary Mandates Applied
– Each fund must score in the top 25% to be considered
• Funds are Evaluated with a Scorecard– Watch List– Replacement List
• Asset Classes Clearly Defined• Two Fund Lineups (see
www.retirementplanconsultants.net)– RIA Partner – Uses 5-year mandates– DFA Partner – Uses 10-year mandates
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Fiduciary Mandates Applied• Performance: The product must have positive excess performance relative
to its benchmark over a stated time period.• Product Assets: Must have a least $100 million managed in this specific
investment style.• Peer Group: The product’s return must be higher than the peer group’s 50th
percentile return.• Alpha: The product’s Alpha must be greater than or equal to 0.• Sharpe: The product’s Sharpe Ratio must be greater than or equal to the
benchmark.• Standard Deviation: The product’s standard deviation must be less than or
equal to 150% of the benchmark’s standard deviation.• Tracking Error: The product’s tracking error must be less than 10%.• Product History: Product must have been in existence for a stated time
period.
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Fiduciary Quarterly/Annual fund monitoring