Written by Andrew C. Canter, CFA
Institutional investors face a unique challenge: If they must take risk to meet return requirements, then how can they measure that risk in a comprehensive manner? Integrated risk reporting and management quickly becomes complicated for institutional investors, given the lack of consistency in various systems and reports used by their underlying managers, funds, and investments.
At the 70th CFA Institute Annual Conference, Frances Barney, CFA, discussed how this challenge can be addressed through enterprise risk analysis. Barney, who is head of global risk solutions at BNY Mellon, gave a presentation on effective ways to review all of an investor’s assets for embedded investment risks. (However, this review would exclude normally non-investment risks, such as regulatory risk or longevity risk.)
Barney suggested a few different ways to approach enterprise risk analysis: Read More