Articles for Investment Manager Audits

A Transitive Property of Fiduciary Duties?

A Transitive Property of Fiduciary Duties?

If A = B and B = C, then A = C. This is the “transitive property of equality” that we learned in our remedial algebra classes so long ago. Is there a transitive property of fiduciary duties?  We know that the trustee owes duties of care to the trust beneficiaries. We...

A Trustee’s Duty to Independently Monitor Investment Advisors

A Trustee’s Duty to Independently Monitor Investment Advisors

Many trustees implicitly trust the investment advisor to whom investment duties have been delegated. They trust that the advisor’s strategy is reasonable. They trust that the return the advisor produced was reasonable given the level of risk that was taken. They trust that the benchmark the advisor is comparing himself against is fairly established. They trust that the advisor’s fees are fair. They trust that the advisor’s representation of being “above average” is supported by facts.

Is my investment advisor doing a good job?

Is my investment advisor doing a good job?

It’s difficult to answer the question, “Is my investment advisor doing a good job?” Predictably, all investment advisors report that they are “doing great” and are “above average.” They all provide compelling charts, graphs and benchmarks…

Does Size Matter?

Does Size Matter?

Do “big investors” have better investment results than “small investors”? Many business managers expect that their wealthy clients with large portfolios ($25m+) should have better returns because the clients have access to the best and brightest members of...