Stewards for Our Clients

Stewardship is the core of Innovest’s identity and mission. We are thoughtful stewards of clients’ resources as we help them meet their individual objectives.

Portfolio Design

Innovest looks forward approximately five to 10 years when evaluating the capital markets, including the changes in the global economy and asset class fundamentals and valuations. Using a thoughtful and methodical approach, Innovest designs investment portfolios on a forward-looking basis by combining client-specific objectives with our long-term projections for risk, returns and asset class correlations.

Portfolio Risk Management

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Based on our forward-looking projections for asset class returns, volatility and correlations, we quantify the given downside risk of portfolios in terms of a worst-case loss (95th or 99th percentiles) in a given one-year period. Quantifying the downside risk of a portfolio has proven to be the best way to communicate and measure portfolio volatility. 

Diversification Through Asset Allocation

Because over 90% of the variability of portfolio performance is attributable to asset allocation, defining the goals and objectives of the portfolios is crucial. Our asset allocation modeling utilizes a forward-looking approach to the capital markets environment and asset class returns. Diversification among and within asset classes and strategies is essential to reducing investment risk and meeting long-term objectives.

Selection of Investment Products, Strategies and Managers

Our research focuses on understanding whether an investment manager’s strategy has an advantage in adding value in the future. The research generated by our dedicated, in-house research team, and complemented by external research, is time-tested and proven. We do not believe that a computer can successfully choose managers that will outperform going forward. We rely on our dedicated in-house investment professionals to do so.

Investment Policy Statements and Quarterly Reviews

The ultimate result of our stewardship philosophy is reflected in each client’s Investment Policy Statement (IPS) and ongoing quarterly reports. The IPS includes portfolio objectives, time horizon, risk tolerance, return objectives, liquidity needs, as well any other client-specific considerations. In addition, Investment Policy Statements are reviewed on an annual basis and in concert with the annual asset allocation review. Quarterly reviews build the ongoing trust between clients and consultants.