Manager selection begins with FCM and our Strategic Investor sourcing and interviewing managers. Equally important as a manager's ability to extract alpha is that manager's ability to do so in a manner structurally different than others. This may include different styles, markets, and time horizons. The goal is to identify managers whose positions should not correlate in a manner that concentrates portfolio risk.

Without question, FCM’s strategic partnerships provide superior access to top quality managers such that 25-30% of the funds in the Concert portfolio are otherwise closed to new investments. However, FCM also maintains a list of hedge funds, numbering two to three dozen at any one time, that meet our investment criteria providing a pipeline for future allocations.

Once the Investment Committee decides to add to or modify a strategy bucket, FCM conducts pro forma allocation studies to quantify the range of likely allocations to the manager and the impact on the strategy bucket portfolio (contributions to risk, returns, and other allocations).