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Risk Management

Truston’s Risk Management and Compliance Team is responsible for managing all firm-wide risks. The Team should monitor regularly, so that Truston adheres to strict investment risk management control processes related to the monitoring of investment performance, compliance to investment objectives and investor guidelines

1. Performance Evaluation

We conduct performance and risk-return analysis on a daily, weekly, monthly, quarterly and yearly basis.

We monitor risk metrics such as Tracking Error, Information Ratio, Volatility, Sharpe Ratio and so on.

On a monthly basis, we analyze the performance attribution by decomposing the excess return into asset allocation effect, sector allocation effect and stock selection effect.

2. Self-Regulation and Ethics

In addition to following relevant laws and regulations, we have implemented a strict set of internal guidelines in order to protect the interest of our clients. These guidelines cover matters such as entertainment with clients, confidential information, and compensation from other activities. Employees are required to report periodically to the compliance officer to ensure that no rules have been broken.

In conjunction with the Risk Management Team, the Compliance Officer monitors activities for the potential breach of laws and regulations or internal misappropriations through the trading system and fund administration system.

3. Conflict of Interests

There is a central trading desk (trading team), it is separated from portfolio managers.

Trading information is kept from research analysts and staff dealing with proprietary investments.

Employees are prohibited from trading stocks in their own accounts.

4. Risk management process

The Head of the Risk Management and Compliance Team report the current risk status of the portfolios to the Risk Management Committee, whose meetings are held as and when needed.

Pre-trade Risk Management and Compliance Check

Post-trade Risk Management and Compliance Check

Performance Attribution and Risk-Return Analysis

The Risk Management and Compliance Team are responsible for identifying and controlling risks. In other words, the team monitors all potential risks on a firm-wide scale. It includes operational risk, financial risk, technological risk, compliance risk and so on.

The Risk Management and Compliance Team perform risk control and monitoring in a diverse set of the risk management systems.

Risk Factor Risk Management
Market Risk/ Liquidity Risk

Risk-adjusted return analysis

Excess return analysis

Monitor minimum cash and equivalents compared to the NAV

Post compliance check more than 30% of the 20-day average daily trading volume

Counterparty / Credit Risk

Broker allocation policy

Investing only in qualified investment assets

Strictly prohibit except investment universe

Operational Risk/Legal Risk

Daily Operation Check List

Daily NAV Reconciliation

Daily Compliance Report

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