Advisory Services
Expertise grounded in experience
Altree Capital delivers leading African asset management and advisory services to investors across the globe. Our flagship Africa Opportunities Fund is an established market leader and has won numerous accolades, including Africa ex-South Africa Fund of the Year 2011. Our Separately Managed Account (SMA) Platform offers institutional investors with rarefied access to the African capital markets whilst ensuring unparalleled levels of transparency and control. Our risk and advisory services include design and implementation of African investment policy, valuation and pricing of African securities, portfolio creation and optimization, and operational risk mitigation.
Investment Policy
Promoting long-term discipline while insuring against short-term shifts in strategy
The investment policy statement guides the investment process and delineates the risk/return objectives and portfolio management constraints surrounding an individual strategy. The African capital markets are complex and diverse with over 1,400 publicly-listed securities across 22 local exchanges. Markets are highly fragmented and present numerous structural challenges which must be carefully considered before investment. We work with investors to ensure that capital market expectations are reasonable, the asset allocation strategy is appropriate, and guidelines for portfolio adjustments and rebalancing are well documented.
Valuation & Pricing
Combining technical and quantitative expertise
Valuation and risk management are really two sides of the same coin as both disciplines require similar skills to be accurate and effective. When pricing individual securities across Africa, investors must account for such issues as asset liquidity risk, funding liquidity risk, local currency risk, and political event risk, among other items. Among the services performed are:
- Define and maintain pricing policy
- Select and source relevant market data and third-party pricing agents
- Operate the valuation models used to support third-party pricing of OTC transactions
- Lead the month-end finalisation process
- Chair and operate the pricing committee for finalised NAVs
In order to properly mitigate exposure in adverse market conditions, an investor must properly value the enterprise so as to accurately estimate its overall risk.
Portfolio Maintenance
Independent implementation of systems and guidelines
We assist clients in their efforts to maintain an overriding policy of compliance with all applicable statutes, rules, regulations and prudent business practices related to its business. Portfolio maintenance is critical as it enables the manager to actively monitor the risks inherent within each individual aspect of the business process. Among the numerous services performed are:
- Operate valuation and position monitors
- Implement and enforce cash management policies
- Generate and distribute estimated and final NAV reports for all shares issued
- Prepare account opening documents for managers
- Negotiate credit agreements with service providers
- Perform requisite KYC / AML procedures on all related counterparties
- Review all monthly client statements prepared by the administrator
- Review all financial statements and tax returns for the various vehicles, as prepared by the auditors
Risk Mitigation
Hidden vulnerabilities, changing correlations and fat-tailed distributions
Efforts to mitigate African investment risk often focus on portfolio valuation at the expense of internal processes, controls, compliance, and guarding against business failure. We assist clients in their efforts to develop sound risk management practices and procedures that are superior in both breadth and scope. Among the numerous services performed are:
- Define market risk policy
- Operate market infrastructure
- Generate all market risk reports
- Chair and operate market risk management committee
- Define credit risk policy
- Operate credit risk infrastructure
- Generate all credit risk reports for both internal and external users
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