|Chris Ruppel |
Merion Capital LLC
|Merion Capital LLC is an independent, fee-only registered investment advisor based in Kalamazoo, Mich. Founded in 2000, Merion primarily serves institutional clients, bringing an investment committee perspective to help clients achieve their financial goals.|
|An independent solution|
Back when I worked in corporate finance, I volunteered with an investment committee to help a local municipality invest pension assets on behalf of the plan sponsor. Questions often arose about the plan’s actual historical performance between given dates, as well as comparative performance evaluations against other managers, portfolios or benchmarks. We went looking for some software to help us make those comparisons, and found Morningstar® EnCorr®.
We wanted a process and a product that was totally independent. EnCorr provided a cost-effective platform to independently evaluate the current portfolio and managers, as well as to construct efficient frontiers for portfolio planning.
A valuable decision-making tool
As my support to the investment committee evolved into founding Merion Capital, I took EnCorr along. It was a tool I knew I would need.
|The ability in EnCorr to select series and to construct portfolios for comparisons is most valuable. It helps us work through multiple investment scenarios and narrow the risk-reward choices down to help the client make a decision. |
Expanding the efficient frontier
The resampling functionality in EnCorr is very important. Before resampling, as we put our constraints in, the efficient frontier would get pretty short. The resampling expands that frontier out again to give us an expanded universe of options. So where we wind up on the curve might be different than if we didn’t have resampling.
Evidence to enhance client communication
Several years ago, we were trying to decide whether to move into international securities and hedge funds. Some data series on hedge funds we couldn’t run in EnCorr, because there wasn’t a sufficient historical database of hedge funds providing public information.
|That lack of transparency, we thought, was quite telling. This helped us in communicating to clients that we felt there was an advantage to international, but not to hedge funds. |