Risk Management at the Centre
We seek to manage risk in order to capitalise on opportunities and improve our performance. Disciplined risk estimation and management are deeply integrated components of the investment process across each one of our strategies.
We believe a well-constructed portfolio upfront will outperform in good markets and protect our client’s capital in difficult markets. For this reason, Apex Trust Funds has spent years establishing risk management as a core discipline. This approach begins with a dedicated governance group that oversees risk management. An emphasis on liquid markets, proprietary risk models and a diversified funding structure seeks to further strengthen our approach.
Reinforce The Culture
A solid framework is important, but successful risk management can only be accomplished when it becomes a central part of the portfolio manager’s analysis of potential trades and portfolio construction. Continuous communication and collaboration with the investment teams, combined with an in-depth understanding of the portfolios, play a critical role in maintaining and strengthening our risk culture.
The Apex Trust Funds way:
A Dedicated Risk Management Team
Operating independently of the investment businesses, and reporting to the CEO, the Portfolio Construction and Risk Group (PCG) guides the allocation of risk capital. It is supported by a dedicated R&D team to create custom tools and technologies.
The Risk Management Center
Apex Trust Funds’s Risk Management Center provides a comprehensive view of the various investment portfolios and how they fit within pre-established guidelines. its front-end consists of a 27’ by 8’ interactive touchscreen designed to visualize data in ways that allow for rapid comprehension. Its back-end systems, which connect to every Apex Trust Funds office worldwide, continuously run a wide range of operational readiness, risk, and stress test monitors.
Run Rigorous Processes
In pre-trade discussions, the Portfolio Construction and Risk group works to identify the impact of potential trades on a portfolio’s risk and stress exposures. In the ex-post analysis, the group evaluates the skill, infrastructure, investment universe, risk and working capital utilization of each business, and uses this information as a part of the risk capital allocation process.
Financial Risk
The Company has no appetite to fail to maintain sufficient resources to meet its contractual, business and regulatory obligations. We will ensure it can do so under both normal conditions and an appropriate range of company and market stressed scenarios. The Company has an appetite for market and credit risk exposures where these are required in pursuit of its business objectives. Exposures must be controlled to manage capital and liquidity requirements, concentration risk and the risk of financial loss.
Market Risk
The risk of investments declining in value because of economic developments or other events that affect the entire market.
Liquidity Risk
The risk of being unable to sell your investment at a fair price and get your money out when you want to. To sell the investment, you may need to accept a lower price. In some cases, such as exempt market investments, it may not be possible to sell the investment at all.
Strategic Risk
The Company has an appetite for strategic risk that arises as a consequence of pursuing its chosen business model. We proactively identify and understand the strategic risks that it is exposed to, the options available to manage them and ensure that these inform strategy formation and business planning. We have a limited appetite for failing to deliver our business plan objectives as a result of underperformance that is within our direct control. Ongoing performance against the business plan are closely monitored and prompt action taken to address any material adverse divergence
Foreign Exchange Risk
The Sub-Fund may hold securities denominated in a currency other than the base currency. Changes in foreign currency exchange rates will affect the value of securities held in the Sub-Fund or value of shares held by the shareholders respectively. A depreciation of the denomination currency will lead to depreciation in the exchange value of the securities. Shareholders investing in the Sub-Fund other than in its base currency should be aware that exchange rate fluctuations could cause the value of their investment to diminish
