The T Standard
Calculating performance during a portfolio transition
We developed the T Standard to help investors measure the performance of portfolios during a transition. It's an important step toward bringing transition management to the same consistency expected in more traditional forms of performance measurement.
The T Standard can help you by:
- Presenting results from your perspective.
T Standard reporting is consistent with implementation shortfall and with CFA Institute performance standards.
- Showing the impact of any undisclosed activities
With the T Standard, you know exactly how your investments performed throughout your transition.
- Making it easier to compare and evaluate proposals.
The T Standard is a step forward in providing meaningful composite track records for clients.
- Allowing meaningful analysis of outcome.
The T Standard makes it harder for providers to disguise poor outcomes.
Used industry-wide for almost a decade, the T Standard has been updated over the years to reflect feedback requested from plan sponsors, providers and consultants. Feedback after the initial launch of the T Standard indicated that few changes were needed. In response to industry input, we clarified ambiguities, expanded reach into uncovered areas, and improved the level of transparency.
Recent enhancements to the T Standard
- More clarifying examples throughout the text.
- Timing of different components of the performance period(s) is described in more detail.
- Changes to the target portfolio during the implementation period are measured using the prior night's closing prices (T-1) prior to practical implementation of the target adjustment.
- Increased transparency is provided through disclosure around the timing of the receipt of portfolio information and/or target portfolio changes.
- Clarity is offered on the prices allowable for return calculation. Generally speaking, sources will be independent and disclosed, with calculation methodologies given in footnotes.
Because we use the T Standard, you can count on the accuracy of our estimate and the actual results we report. We also use the T Ratio to give you a context for comparing transitions that differ in complexity. Learn more about the T Ratio.
Russell Investments Implementation Services LLC., member of FINRA, SIPC. www.finra.org