Stableford Capital Insights
Stableford Capital Makes It Easy to Compare Investment Performance with GIPS Compliance (Part 2)
Disclosures:
- Stableford Capital claims compliance with the Global Investment Performance Standards (GIPS®).
- GIPS® is a registered trademark of CFA Institute. CFA Institute does not endorse or promote this organization, nor does it warrant the accuracy or quality of the content contained herein. To receive a GIPS report and/or our firm’s list of composites, please email your request to inquiries@stablefordcapital.com
Putting your trust in an investment firm is a big step. You want information about investment performance, goals, and client satisfaction. The Global Investment Performance Standards are a tool specifically designed to provide some of this information.As you consider Stableford Capital - or any other firm - to handle your asset management, it’s important to understand the benefits of a firm that is GIPS compliant or verified. You can better compare our investment performance to other firms, along with our history. You can also obtain recent information from us about our firm-wide compliance.
Why We Are GIPS Compliant
We are compliant for two reasons.
- To provide you, our investors, with the best information available.
- To hold ourselves to a high standard.
Not only can you see our results in comparison to other firms, but you can also compare them to our past management. This leads to building confidence that we have consistent success. GIPS compliance mandates that firms are required to start with at least 5 years of performance and after that are required to build up to 10 years of performance.It should be easy for you to see that we are doing a good job - or if we aren’t. GIPS takes the next step in working to prevent an investment firm from hiding poor investment performance. Recent updates change reporting and prevent cherry-picking carve-outs. GIPS rules require investment firms to disclose accurate, relevant information to their current and potential investors.By holding ourselves to these high standards, we hope to provide a high level of service - one which you can objectively see is performing well. Investment is all about the numbers and we are proud to show off our good ones.
The Basis of Compliance
In 1999, the Chartered Financial Analyst (CFA) Institute released the original Global Investment Performance Standards. They were designed as a set of voluntary guidelines. The CFA’s intention was to provide simple standards for firms to follow. When applied, these standards make self-representation and disclosure more accurate.
These standards grew out of even earlier guidelines. These were known as the Association for Investment Management and Research-Performance Presentation Standards (AIMR-PPS), from the late 1980s.
In the three decades since these ideas took root, over 1,700 firms use the GIPS as their investment performance guidelines. In 2014, the CFA surveyed internationally to discover a high rate of GIPS use. At that point, 74% of the top 100 firms managing assets around the world were GIPS compliant.
The CFA Institute rules and suggestions that make up the GIPS are a list of best practices. These industry standards only make sense to hold ourselves, as they verify that we are putting our clients first and our best foot forward in our investing strategies. In turn, this provides you with the most transparent information about where your investment goes.
What Compliance Means for Investment Performance
There’s no cherry-picking here, which means excluding poor investment performance information from reports. When working with GIPS compliant firms, you can be confident their evaluation process has not left out any of this poor performance.To remain compliant and show up-to-date information about our investment performance, Stableford Capital prepares annual reports that provide clients with recent information. Standards dictate the reports cover up to at least the last year before publication.
Comparison Across Markets
Compliance across markets requires investment firms to do things similarly. This creates objective data for clients. This can be used to compare performance even when processes and languages differ across regions.
As investors like you look for more and more promising investments in the global market, the need for universal standards becomes more essential. More firms will continue to work with GIPS guidelines, creating a host of options for investors to choose from.
In the meantime, amongst the existing GIPS compliant firms like Stableford Capital, you can already see and compare our performance. Through our reports and performance history, we aim to show you our accurate investment performance successes. The gathered data should answer questions you may have about working with us and trusting us with your investments.
Interested in learning more about GIPS, read part one here.
Have any other potential questions or ready to work with a Global Investment Performance Standards compliant firm? Get in touch today to begin investing with Stableford Capital by calling 480.493.2300, or schedule a complimentary 15-minute consultation online.
