PerTrac Software Finds Hidden Risk In Portfolios

Jul 19 2011 | 10:16am ET

New York-based investment software firm PerTrac, in partnership with FinAnalytica, has released an advanced risk analysis module to help institutional investors discover hidden risks in their portfolios.

PerTrac RiskPlus 1.2 uses multi-variable analysis, stress testing and risk budgeting to measure portfolio risk. The software addresses a key problem for institutional investors—valuing illiquid assets (like private equity and real estate) on a monthly basis. The new module’s advanced infilling techniquest convert quarterly illiquid asset performance to monthly performance streams.

PerTrac RiskPlus 1.2 also allows investors to break down and understand the risks and exposures of funds with a specific geographic focus. Using five new geographically-focused factor models, which have been defined and tested by FinAnalytica’s quantitative research team, investors can, for example, assess Asia-focused funds using an Asia-specific factor model rather than analyzing risk with the same factor model used to analyze non-geographically focused funds.

“Whether you are an investor or a manager, you are concerned with limiting losses when the worst-case scenarios arise. Decisions based on traditional risk measures and the assumption of normal return distribution characteristics for assets have led to potentially large portfolio losses by underestimating hidden risks. This new release of PerTrac RiskPlus gives investment professionals the tools they need to analyze their comprehensive risk,” said Brendan Dolan, co-president of PerTrac.

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