Core questions
- Assess exposures in the context of an existing portfolio
- Review custody, counterparties, liquidity and operating procedures
- Define decision processes, limits and reporting requirements
Mandate, liabilities, and decision authority
An institutional review starts with the governing mandate rather than a preferred asset. Identify permitted instruments, return objectives, liquidity obligations, holding periods, currency needs, and loss constraints. An institution with scheduled payments may evaluate the same investment differently from one with flexible long-term capital
Document who proposes, approves, implements, and reviews decisions. Board, committee, manager, and operational responsibilities can be different. A research conclusion is not authorization to act; implementation must fit the institution’s written limits and formal decision process
Allocation and portfolio integration
Evaluate a proposed exposure in relation to current holdings and liabilities. Review common market factors, sector and country concentration, credit exposure, and whether a new instrument duplicates risks already held through a fund or derivative. Diversification should be assessed through the combined portfolio rather than the number of products
Private investments, digital assets, and derivatives impose different valuation and cash-flow requirements. Research should compare allocations under consistent assumptions and distinguish reported values from amounts that could actually be realized to fund institutional obligations
Custody and counterparty oversight
Map each entity responsible for asset holding, execution, collateral, settlement, and reporting. Examine segregation, withdrawal procedures, access controls, and reconciliations. For digital exposures, key management and any smart-contract or settlement-asset dependencies belong in the same operating review
Counterparty limits should consider the total relationship, not only a single account balance. Assess how an intermediary failure, operational outage, or disputed valuation could affect access to assets and cash. Documentation and oversight are distinct from relying on a provider’s commercial reputation
Stress analysis and liquidity planning
Test market losses together with collateral calls, reduced asset liquidity, and changes in liabilities. These events can occur at the same time. Research should distinguish assets available for immediate cash needs from holdings that require consent, long settlement periods, or an uncertain exit
Compare the proposed allocation with alternative scenarios and identify the assumptions that drive the result. A historical risk estimate is not a guaranteed boundary. The review should explain what operational responses remain available if the institution cannot trade or transfer assets as expected
Reporting and implementation review
A research framework can organize a mandate comparison, exposure inventory, scenario findings, and unresolved implementation questions. Reports should distinguish performance, contributions, distributions, expenses, and unrealized valuation changes. Frequency and responsibility for reporting require agreement
Before any service relationship, confirm the operating entity, jurisdiction, eligibility, authorization, custody arrangements, conflicts, and fees. This client framework describes research considerations; it does not establish discretionary management, fiduciary responsibility, or a confirmed institutional mandate
Related product areas
Information for an initial discussion
- Institutional mandate and decision process
- Portfolio objectives, constraints and jurisdictions
- Custody, reporting and disclosure requirements
Service and participation conditions
Client needs do not establish a confirmed service commitment. Actual cooperation requires review of the entity, jurisdiction, eligibility, fees and documentation. Transactions and investments are governed by formal terms
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