Risk Management

All of Aurum’s processes are designed to preserve investors’ capital. This is achieved through constant detailed quantitative monitoring of the underlying hedge funds to ensure that the associated risks are clearly identified, defined and appropriately managed.

The Risk Committee operates independently from the Investment Research team. The role of the Risk Committee is to ensure all portfolios are reviewed ex-post for excess risk, and, in conjunction with the CIO, to ensure that action is taken to mitigate the impact of downside events. The Risk Committee does not participate in the portfolio construction process, or in the process to determine whether an initial investment is made in a particular hedge fund.

Each Aurum Fund has its own specific risk limits which are set internally to ensure that

(a) there is sufficient diversification of risk such that the risk of loss to investors is minimised; and

(b) the original mandate of each portfolio is adhered to in line with investors’ expectations.