Best practices for multiple sub-adviser mutual funds

Operational and compliance best practices for mutual fund portfolios with multiple sub-advisers

Combining multiple sub-advisers within a single mutual fund creates numerous complexities for investment managers who seek to generate maximum value, efficiency and controls with this fund structure. Success requires careful planning and strict adherence to compliance requirements, operational processes and communications practices. Otherwise, the sub-adviser model can exacerbate compliance and processing risks and impede the fund’s performance.

The linked whitepaper presents a number of best practices for robust operational and compliance procedures for funds with multiple sub-advisers — both at the fund’s inception and throughout its lifetime. It covers the following topics:

  • Adviser responsibilities in a sub-advised mutual fund
  • Mutual fund sub-adviser responsibilities
  • Best practices for onboarding and transitioning sub-advisers to mutual funds
  • Mutual fund compliance testing best practices
  • Portfolio allocation and cash management best practices
  • Fund CCO and board best practices in sub-advised mutual funds.

Applying the concepts presented in this whitepaper can help minimize processing and compliance complications and ensure stability within the fund. Draw from this experience-tested information to improve efficiency and reduce operational, financial and reputational risks for all parties.

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