Managing and monitoring risk lies at the heart of what we do. Liongate employs a comprehensive system for managing risk, with our teams conducting qualitative and quantitative analysis on each of our managers. We closely monitor three kinds of risk: market risk, liquidity risk and operational risk at all levels of the portfolio.
Liongate demands a minimum level of transparency from all of our underlying managers. We have a comprehensive understanding of the risks inherent in each hedge fund strategy and manager. This knowledge enables us to maximise performance at acceptable levels of risk.
For each of our portfolios, our Quantitative Analysis & Risk Management Team aggregates our underlying managers’ asset exposures. This allows us to build an accurate picture of risks at the manager, strategy and portfolio levels and allows us to monitor liquidity, leverage and concentrations across different asset classes. Our process also involves independent confirmation of our manager’s positions and risk exposures.
Our Quantitative Analysis & Risk Management Team has developed proprietary portfolio and risk management tools, called PRiMα, to analyse our fund manager data. PRiMα combines the best features of external database providers with additional customised features not covered by alternative solutions. PRiMα helps the Team analyse traditional manager, strategy and portfolio risk factors such as equity and credit beta, as well as factors specific to hedge funds, such as extreme event and other non-normal risks.