The Fund Risk Controlling department is implementing and controlling client-specific, contractual, legal and internal restrictions. There are ex-post as well as ex-ante controlling processes.
With MIG21 (GX Compliance) we possess an automatic controlling system to check the compliance of legal, contractual, client specific and internal restrictions. Such controlling is carried out ex ante that means before the order for the particular mandate is placed in the market by the Trading Desk. In addition, we conduct a daily ex-post compliance check of our holdings with the applicable restrictions. Therefore, it is nearly impossible, that violations of investment guidelines occur. If violations occur, they will be displayed to portfolio management automatically via MIG21 (GX Compliance). The portfolio manager is obliged to comment on any guideline breaches and to take immediate action to correct the violation. In case of breaches of contractual constraints due to market movements, we discuss with the client how to proceed, keeping the best interest of our clients in mind. Fund Risk Controlling is monitoring this process.
Depending on the significance of the breaches, managing directors are informed as well. Our escalation procedures are clearly defined within our organizational handbook.