PCG ASSET MANAGEMENT IS A RESEARCH DRIVEN ORGANIZATION THAT EMPLOYS A COMPREHENSIVE APPROACH TO INVESTMENT DUE DILIGENCE AND RISK MANAGEMENT, ENSURING APPROPRIATE DIVERSIFICATION AT THE PORTFOLIO LEVEL, WHILE FOCUSING ON FUND LEVEL ISSUES BOTH PRE- AND POST-INVESTMENT.
As one of the industry’s leading private equity advisory firms, PCG AM has access to virtually every private equity fund that is raising capital. Due to the size and experience of our sector-focused research teams, we are able to provide extensive market coverage, exceptional sourcing capabilities, in-depth industry knowledge, and rigorous due diligence and analysis to capitalize on this unparalleled access. We utilize an investment approach that combines customized portfolio construction and manager selection to achieve attractive risk-adjusted returns, and our due diligence process evaluates the merits of each investment opportunity while considering the fit within the context of our clients’ portfolio.
Over our nearly thirty-year history of private equity investing and consulting on behalf of sophisticated institutions, we have developed strong relationships with many of the most highly regarded managers in the world. We maintain an investment pipeline to access the majority of the private equity funds seeking investors at any point in time, and have demonstrated a proven ability to discern sustainable investment strategies using our proprietary analytical tools and methodology which has been refined over several investment and business cycles. We combine these analytical tools with our institutional private equity knowledge and the experience of our professionals to guide our clients’ strategic deployments in the private equity asset class.
From our perspective as an advisor and manager, a key aspect of risk management involves appropriate portfolio diversification. PCG AM regularly evaluates our clients’ portfolios for areas of excessive risk, including geographical, industry or sector over- or under-exposure through strategic and tactical planning. We then recommend changes in prospective manager selection in order to dynamically rebalance each portfolio. PCG AM strongly believes that it is difficult to make accurate predictions about the macro economy and the expected performance of different private equity asset classes several years in the future; therefore, we advocate a disciplined investment approach for our clients, with appropriate allocations to all of the major private equity classes on a strategic basis. Within that framework, we help clients identify and implement tactical shifts in their programs in order to capitalize on medium- and short-term market opportunities to boost returns and mitigate risk.
We develop customized solutions for each client based on their distinct investment goals, objectives and risk tolerance levels. In order to structure optimized portfolios for each client, any recommended investment must be appropriate and additive to the client’s portfolio and achieve a high level of investment merit.
Pre-Investment Risk Review
We believe that comprehensive risk management begins with a thorough due diligence process aimed at fully understanding the potential rewards and risks of each investment opportunity; a process that allows us to select top-tier managers for our clients. Post-investment, we maintain a continuous monitoring process to ensure adherence to investment strategy, diversification, and performance goals.
Protecting Investors' Interests
PCG AM is integrally involved in the structuring of limited partnership agreements relating to our clients’ fund commitments in order to ensure the best possible alignment of interests with general partners, as well as strong limited partner protections. PCG AM can act as both an advisor to client counsel and as a direct negotiator of partnership agreements, depending on client preference. Some of these considerations include appropriate fees, clawback provisions, key person provisions, portfolio diversification, and concentration limits.
Post-Investment Risk Monitoring
Our Risk Management department scrutinizes fund activities through the evaluation of cash flows and investment reports, in addition to regular communications with investor principals. Furthermore, we make certain that the necessary financial controls are in place to protect the interests of our clients. We track our clients' portfolio concentrations by industry, geography, company and manager to better understand portfolio risk.