A cumbersome phrase, but a crucial discipline:
A process suggests a routine that is intended to be followed habitually, and quantitative indicates measurable data. These two words create a cumbersome phrase, but their implication is foundational to any valid advisory service, especially when applied to employer sponsored retirement plans. We believe this to be so essential, that we chose the phrase for our company name.
Decisions guided by a statistical framework with measurable outcomes:
The uncertainty of outcomes in a complex world, especially in the area of investments, drives the need for process. A quantitative process does not tell you the precise decisions to make, nor does it guarantee an outcome. It does, however, provide a statistical framework within which highly informed decisions can be made, and outcomes can be measured. Since no outcome is ever guaranteed, a process’ capacity to measure well is vital to problem identification and resolution.
The best method for reducing an employer’s plan related liabilities:
When employers offer a retirement plan, they take on serious responsibilities. With these responsibilities come liabilities. A valid process, consistently applied and documented, is the most effective method of mitigating liability. Consider the following statement from the Department of Labor:
“The duty to act prudently is one of a fiduciary’s central responsibilities under ERISA […] Prudence focuses on the process [DOL’s emphasis] for making fiduciary decisions. Therefore, it is wise to document decisions and the basis for those decisions”
US Department of Labor publication: Meeting Your Fiduciary Responsibilities
In Summary, Our Quantitative Process:
- Creates a STATISTICAL FRAMEWORK that supports decision making
- Continually MEASURES results
- Provides DOCUMENTATION
What is the process guiding your plan?