Transition management

July 11, 2019

When an institutional investor adds a new asset class, rebalances, or hires or fires a manager, assets will need to be moved from one or more portfolios to other, potentially new, portfolios.

These assets may stay within the same asset class (e.g., when one small cap stock manager is replaced with another) or they may move across asset classes (e.g., when a new allocation to TIPS is being funded from equities). Increasingly, institutional investors use the services of “transition managers” to conduct these portfolio transitions. Transition managers provide professional management of the transition of assets.