Alternative Investment Awards 2016

www.wealthandfinance-intl.com 19 When making an investment the allocator agrees with the manager on specific risk parameters, and this is then hardcoded and monitored by the Sentinel account manager. Taking a proactive, rather than a reactive approach, we are able to ensure things many platforms do not. Our system allows us to stop a trade from breaking a risk parameter before it occurs (pre trade compliance) as well as warn us when a manager is close to breaking a risk constraint based on attribution (post trade com- pliance), allowing us to have a constructive conversation before an issue occurs not after which both avoids disturbing the manager’s investment strategy and protects the interests of our investors. In this environment of market volatility, once that red light comes on it is too late for us, and we developed a system where yellow lights are where proactivity and prevention can change the investment environment. This approach has been highly successful, particularly in recent years, as the market returned to its usual volatility patterns following an ex- tended period of quantitative easing and directional up markets. In our opinion it was this artificial market support by the Federal Reserve that has now caused greater issues in the financial markets as the industry returns to its normal levels of volatility without that support. Additionally, this directional up market over the past 5 to 7 years made it easier for asset managers to put up good relative returns despite not needing to run a balanced portfolio that would stand up over time in any other market other than one going directionally upwards. When over a 5+ year period a manager can run 50% net long and buy every dip with minimal consequence, it kind of blurs the ability to see who is truly talented and you have to go many layers into the onion to really evaluate a manager properly. We have always chosen managers we feel can generate alpha agnostic of the markets direction. As the market returns to normality it is interesting to see the really strong, efficient emerging managers who are able to generate alpha in both up and down markets, on both the long and short side of their books and it is these managers that we are keen to continue to evaluate for our platform. Overall within the wider financial markets I believe there are a lot of re- ally great emerging managers out there, and if the markets continue as they are currently then there will be plenty of opportunity for those with real drive, determination and skill to become truly successful. Additionally, I believe that separately managed accounts will flourish in the coming years as allocators look for more transparency and control in their investments. Ultimately, I believe that Sentinel’s strategy is very scalable, and there- fore in the future we plan to continue searching for great differentiated emerging managers with real talent to add to our platform so that we can continue providing a solution that meets the needs of both sides of this industry. Looking further ahead, we have plans in 2017 to grow as a business and explore offering our services in additional asset classes in order to meet the industry’s increasing need for portfolio diversity. Currently we operate primarily in the long-short equity space, but we are keen to move into new asset classes and expand as a business, as we know that our solution is meeting the needs of investors and managers alike.