This critical first step of Bivium’s investment process requires broad and deep knowledge of your organization. Salient factors and minute details are captured to produce a comprehensive and high definition picture of your organization:

• Understanding your organization’s history, mission, vision, values, etc.
• Baselining balance sheet health, current pool of assets and funding requirements
• Assessing time horizon, risk tolerance, and unique considerations
• Establishing priorities and investment goals

Establishing a governance structure helps to ensure an effective investment program, which bolsters your ability to deliver on your organization’s mission and objectives over the long-term. Equally important is clearly delineating the roles and responsibilities of key stakeholders, as well as:

• Consultation: Speaking with your organization’s leadership to gain a deeper understanding of constraints, needs, priorities and objectives
• Developing the Investment Policy Statement: guidelines pertaining to return expectations, risk tolerance, and investment constraints, which will aid in asset allocation
• Establishing an Annual Strategic Plan
• Formulating the Risk Budget

Our comprehensive approach is designed to optimize portfolio allocations/investments against liquidity requirements, risks and unique considerations for your organization. Key components of formulating your organization’s strategic asset allocation include:

• Your organization’s profile, investment objectives and time horizon
• Evolving inputs, e.g., capital market expectations, and academic research from leading institutions and think tanks
• The investment approach your organization selects
• Representing client values in investments
• Value-added investment opportunities, e.g., active vs. passive strategies

This time-tested process is distinguished by thoughtful and customized formulation of well-balanced and dynamic portfolios.

• Identification: Focus on appropriate areas for investment and best vehicles for achieving client goals
• Selection: Utilizing extensive due diligence to identify the best practice managers
• Implementation and Ongoing Risk Management: Determining how best to allocate assets among the managers selected, and continually assessing risk through a variety of methods

We examine a wide variety of considerations (e.g., fees, liquidity, trading venues, operational capabilities, etc.) to:

• Implement/transition assets into the strategic asset allocation
• Ensure investment guideline adherence
• Optimize tax efficiency for taxable accounts
• Minimize implementation transaction costs
• Identify vendors as necessary

Reviewing numerous factors (such as value-at-risk, tracking error, position/sector concentration, fundamental/factor characteristics, holdings turnover, and liquidity) all aid in guiding your organization toward the goals you define at the start of the investment process.

Additional risk management methods include, but are not limited to:

• Managing investment, operational and headline risk
• Evaluating target weightings based on changing client needs and/or evolving markets
• Rebalancing as appropriate
• Measuring investment impact
• Utilizing Bivium’s proprietary system for daily portfolio monitoring and manager compliance checks