By: Nancy Chirinian
The Global Investment Performance Standards (GIPS) executive committee aims to establish investment industry best practices for calculating and presenting investment performance and to obtain worldwide acceptance of a single standard. The voluntary GIPS ethical standards for calculating and presenting historical investment performance have been adopted by investment management firms in at least 34 countries since first being introduced in 1999. Compliance brings with it many benefits; it allows firms to:
- Remain competitive by achieving compliance with worldwide industry standards.
- Improve the consistency and effectiveness of marketing materials.
- Provide clients, prospective clients, and consultants with the best opportunity to fairly evaluate their past performance.
- Demonstrate a firm-wide commitment to the deployment of strong internal controls.
- Build a reputation of trust and credibility in the investment industry.
Find the Right Tools to Help You Achieve GIPS Compliance
If your goal is to remain competitive by achieving compliance with worldwide industry standards, reduce your GIPS verification costs, and improve the consistency and effectiveness of your marketing materials, SS&C has a suite of offerings just for you. SS&C streamlines compliance with GIPS by automating the creation, calculation, and maintenance of composites. We provide you with a systematic, consistent, and accurate approach to composite analytics, disclosures, and reporting so you can:
- Effortlessly conform to the latest GIPS requirements and recommendations.
- Automatically manage composite membership by adding and removing portfolios based on user-defined criteria.
- Support multiple methodologies for calculating composite returns.
- Calculate various dispersion and composite-level risk measures.
- Allow multiple user-defined return types per composite, including gross and net of fee returns.
- Calculate composite net of fee return based on a fee schedule or actual underlying net of fee performance.
- Support extensive disclosure capabilities.
- Maintain a full audit trail with annotations.
- Generate client-ready composite presentations with full audit trail and sign-off.
Investment management firms, their clients, and prospective clients all benefit from having one global standard for performance measurement and evaluation. Compliance to the voluntary GIPS standards enables a firm to compete fairly against other firms globally.