Cornerstone, An Investment Advisory Firm

When considering GSA’s strategic direction, we should first build an understanding of its relative position within the private equity market. GSA’s current value proposition to its clients is: 1) Greater accessibility to private equity firms through GSA’s customized services, allowing less sophisticated clients to progress from a passive fund-of-funds investor into a direct private equity investor, removing the intermediation between the GP and the client; 2) A strategy of “vintage-year diversification”, whereby GSA contributes to funds over a number of different years in order to gain access to many different types of funds; and 3) A compensation structure that is weighted towards carried interest at the expense of fees, ensuring an alignment of interests between GSA and its clients. These strategies have helped the fund retain large and important

The role of the wealth manager is not to simply sell a financial product to a prospect. Instead, a wealth manager’s first concern is developing a comprehensive understanding of the client, a client-centric approach to providing financial solutions. Next the wealth manager must match the right solutions to the client’s needs and desires and ensure he or she receives an exceptional service experience. After that, product and service sales opportunities will naturally follow. Making the transition is clearly a trade-off between short-term results and long-term success. Financial security through goals-based wealth management. As a wealth manager with Merrill Lynch,

1. How has the Investment Office selected, compensated, and controlled private equity fund managers? What explains the differences between their strategy in private equity with that in other asset classes (e.g., real estate)?

The Yale Endowment is known in the financial industry as a pioneer in using a combination of innovative asset allocation and active management to produce impressive long-term performance. In fact, the Endowment produced a 17.8% average annual return, net of fees, in the ten-year period ending June 30, 2007.1 This performance is particularly impressive given that, in recent years, the Endowment portfolio has carried less than a 40% weighting in equities. Instead, under the leadership of Chief Investment Officer Dave Swensen, the Yale Investments Office

Based on given conditions our recommendation is to launch AssetsGuard insurance product line for the following reasons:

Chuck Whitman is a degree holder in finance from DePaul University. Before the establishment of ICM, he worked as a portfolio executive for quite a few wealth management companies with the main objective of gaining as much awareness and experience about the industry and its operational techniques as possible. This enthusiasm to learn is what has led him to successfully establish two of the most well-known establishments in the country. Under to his excellent supervision, ICM group scored the 4th rank in the Wealth management business sector in

According to the book, “Financial Markets and Institutions” by Anthony Saunders, hedge funds are financial intermediaries that pool the financial resources of individuals and companies and invest those resources in (diversified portfolios of assets. In other words, they are a type of investment pool that solicit funds from (wealthy) individuals and other investors (e.g., commercial banks) and invest these funds on their behalf.

One of the methods utilized by this company is an asset allocation model, this model offers the clients multiple strategies they can use such as investing in growth fund this plan does not have much payout for the investor and the risk is higher. The next is Income fund

Instead of relying solely on external management, they allocate 68% of their endowment to internal management and the remaining 32% to outside asset managers. In order to do this, HMC employed 38 investment professionals and 148 other employees whose jobs were solely to manage the $19 billion dollars in total assets, of which $15.1 billion were endowment funds. This management strategy generated expenses of around $93 million dollars per year (49 basis points), and produced a real return of 11.3%, after expenses. This method of investment costs about 19 more basis points than a passive strategy and about 51 basis points cheaper than a typical active investment strategy using 100% outside managers. Harvard University opted for this strategy because it is cheaper than a traditional active management strategy while still allowing them the ability to adjust their risks taken and expected returns in order to remain on the “efficient frontier” of what return was required to meet their internal institutional goals.

This change in direction has led Reifler to develop a plan designed specifically for non-accredited investors who have limited options in which to invest. With this new focus and plan, Reifler also determined five

Yale’s investment philosophy is one of the critical factors that played into the success of the fund’s performance in the past years. The philosophy is based on 5 principles: focus on equity, diversification, opportunities in inefficient markets, outside managers and alignment of manager’s incentives with Yale’s interests. In the paragraphs below I will discuss how each of these principles is reflected in the endowment’s asset allocation, as shown from Exhibit 1.

In 2005, the vice president, chief investment officer, and their investment team met in order to compose a new asset allocation policy for the foundation’s investment portfolio worth $6.4 billion. One of the proposal’s suggestion was to reduce the overall exposure of the investment portfolio to domestic public equities. The proposal would also increase the allocation to absolute return strategies (with an “equitizing” and “bondization” program) and to TIPS. The new policy would slightly increase the Sharpe ratio of the foundation’s portfolio. They also needed to make a decision on a recommendation to pledge about 5% of the total value of the portfolio to Sirius V, which was the latest fund that specialized in global distressed real estate investments.

It was explained at the beginning of the case the MGI founders “were somewhat wary of bringing in outsiders”(p. 4). This was illustrated in their distrust of both Dana and Henry. The lack of ability to conform and accept counter points of view prevented consensus and decision-making. The foundations of the principal owners were too focused on Entrepreneurial Leadership. Igor, Sasha and Roman only incorporated a few behavioral concepts (entrepreneurial leadership); there was certainly a high degree of enthusiasm and creativity (no lack of passion). There was a visionary perspective combined with tenacity, along with a dislike of hierarchy and bureaucracy. There was certainly an eye on the future; however, entrepreneurs often look to the future without having perfected the current business process and product. These three owners had some, not all behaviors of successful entrepreneurs. These founders, lacked the ability to look to the environment and visualize there business’s purpose (mission) in this niche market; which is a core strength of entrepreneurial leadership. Lastly, the foundation of the MGI team was compromised from the start because norms and values were not set in the

MB-Principal Asset Management Berhad (CPAM) is established in 1995. It is an asset management company with regional investment capabilities. CPAM is now one of the largest asset management companies in Malaysia with regional footprint covering Indonesia, Thailand and Singapore. CPAM is owned by the CIMB Group. CPAM is located in Jalan Semantan, Damansara Heights with total number of 300 employees. It manages customized portfolio mandates for corporations, institutions, as well as government and pension funds and also manufactures and distributes a complete range of unit trust funds. It offers expertise ranging from equity, cash management, fixed income and Shariah-compliant fund management.

Blackstone Group L.P. (NYSE:BX)’s size does provide a competitive advantage that could transform to sustainable growth over a longer period of time. Larger alternative asset managers have been the recipients of a tendency to consolidate assets, which is expected to continue onward. Blackstone 's 2-and-20 fee structures on assets under management give it significant operating leverage, and allow it to support excellent margins among rapid growth. Blackstone is the leading option for many pension funds, endowments, family offices, etc. Having the “Blackstone” brand name as a leading competitive advantage.