
Mohamed Ahmed
Senior Consultant
Mohamed Ahmed has over 9 years worth of experience in financial services spanning performance and attribution analysis, risk analytics, asset custody, and listed and unlisted equity analysis. He has experience across the Superannuation and Asset Management spaces as a Performance and Risk Specialist. Mohamed has built out his expertise over the past 12 months covering Operating Model assessment and design for specific operational capabilities.
Leveraging his existing knowledge preformed vendor selection process focused on performance, attribution and data functionalities. Mohamed has exposure to both data management and operations practices through various client engagements.
Prior to joining Cutter Associates, Mohamed was a Performance Specialist in IFM’s Fixed Income team with responsibilities across performance measurement and attribution, risk management as well performing extensive analysis on infrastructure and property debt investments. He also provided oversight to the performance reporting processes.

Andrew Jenkins
Director, Consulting
Andrew Jenkins brings more than 20 years of experience in buy-side financial services, with a focus on project management in the areas of performance measurement and attribution, portfolio analytics, GIPS compliance, risk management, and data management. At Cutter Associates, Andrew works in the firm’s Strategy & Data Management and Performance Measurement practices.
Andrew is a thought leader on performance measurement business practices and GIPS compliance, regularly speaking on the topics at industry conferences. Andrew has a deep understanding of asset management operational and technology processes, and has successfully managed several large-scale operational and systems integration projects throughout his career, including data warehouses, performance measurement and attribution systems, web-integration services, and the acquisition and implementation of a client reporting service. He is active in multiple industry groups in the areas of performance measurement and risk and in board-related forums.
Prior to joining Cutter, Andrew was a director at Charles Schwab Investment Management, where he oversaw performance measurement and attribution, risk, client reporting, and competitive research. He previously worked in the Board Analysis Services Group at Lipper Analytical (now Thomson Reuters). Andrew holds a bachelor of arts in economics from the University of Colorado.
As technology has enabled more outsourcing of operations and investment products have become more complicated, a question every firm should be asking themselves is, “Should we outsource or insource our performance function.”

Performance activities do not fit neatly into a strictly operational or front-office environment, but span both — creating an opportunity to think strategically about what you need your team to own and what may be ripe for outsourcing.
The traditional reasons for insourcing performance are as follows:
- Maintain access and control of your data
- Maintain control over performance calculations, attribution methodologies, models, and fit-for-purpose reference portfolios
- Ability to drill down into returns and analyze outliers
Historically, outsourced service providers have struggled to replicate the level of detail an in-house performance function provides to stakeholders across the front, middle and back office. This is especially true for less standardized performance functions that have client specific needs, requiring more rigor to ensure a service provider solution will be suitable.
Outsourcing Performance Considerations
Some of the reasons why outsourcing may look appealing include the following:
- Firms with smaller and/or less -resourced performance divisions, outsourcing performance can provide access to a global community of performance professionals and best practices that the service provider has implemented through a broad client base.
- Ability to reconcile across the various books of record to ensure integrity in the process. For example, as the ABOR is often outsourced, outsourcing the PBOR and IBOR could enable consistency between the different books. While this is true in theory, in reality it’s not always the case, as different levels of granularity (and views) are required for each, and ABOR is often only reconciled to a pre-specified materiality threshold.
- New service offerings that specifically target middle-office outsourcing could be packaged to provide the required performance reporting.
- End-to-end seamless integration often ranks above other requirements. Thus when combined with other services, outsourcing performance could enable integrated data management.
- Access to leading-edge technology, including industry standard calculation methodologies. However, any customization will require lead time and broader release schedules competing with other client requirements.
Limitations
Don’t pull out your checkbook quite yet! Outsourced performance providers have other limitations too, especially when it comes to performance attribution and environmental, social, and governance (ESG) analysis and reporting.
Attribution
Home is where the heart is, and attribution is where the investment manager’s value-add is often assessed. Attribution is only useful if it’s calculated in a manner that is based on investment decision-making, and that can only happen if there is a complete understanding of the investment process in order to correctly attribute alpha and risk. While equity-style attribution may make perfect sense to outsource, careful consideration is required when outsourcing fixed income, multi-asset attribution, currency, and synthetic overlays, among others.
ESG
Investment performance today is not only measured through an economic lens, but also through an ESG lens. ESG factors are a major force in the investment management industry, with investment firms feeling the heat from their investors who are actively engaged in topics such as climate change. Because ESG is still an evolving landscape, the demands on internal teams in this space do change and require flexibility. As such, they can enrich performance data with specific, multiple, custom, or combined ESG factors to provide ESG reporting that best represents the underlying investment strategy and the specific ESG focus of those charged with the fiduciary oversight. In such a burgeoning domain, it’s critical to ensure that where an outsourced service provider is utilized, its ESG data and strategy align with your firm’s direction.
Accommodating Client-Specific Mandates
In today’s investment environment, clients demand more customization when reporting performance on their mandates. These requests can often be handled by an outsourced provider, but may be delayed due to the standardized nature of an outsourced service. Ongoing customization can be a challenge, as these providers are built for scalable processes, and anything outside of those standards may not be supported. When considering outsourcing, it’s imperative that you present the service provider with your most complex scenarios, service expectations, and unique corner-cases. This is where you will quickly uncover the limitations in the provider’s services.
Cost Considerations
Insourcing performance can be more expensive than using a service provider, but not always. Insourcing requires a large, skilled performance team along with the necessary systems and tools. Without these, the performance team becomes ineffective because it cannot provide the needed granularity and customization. Firms considering outsourcing performance may hope to save money, but when it comes to staffing, they need to maintain a smaller performance team for oversight and management and weigh that against the hidden costs (and risks) associated with outsourcing.
When Outsourced Performance Makes the Most Sense
Outsourcing may be a solution for small firms that do not need to scale the performance function, or simply don’t have the appetite to insource based on their specific investment capabilities and related support functions. Similarly, firms offering retail separately managed accounts may also consider outsourcing due to the standardized nature of the products and the ability to leverage scale via dedicated providers.
Any considerations for outsourcing should cover a matrix of services and responsibilities, including the following:
Capabilities – Can the service provider cover your most complex use cases? Are they positioned to support you alongside your growth strategy?
Cost – What is the aggregate technology, infrastructure, and people costs to maintain (and grow!) your current in-house performance function?
Data & Technology – Does the service provider support the standard and ad hoc data access and timing demands across your firm? Are other functions also being outsourced?
People, Culture & Support – Will the service provider meet your SLAs and be available to respond to inquiries and change requests? Is the provider your counterpart, supporting your firm’s front-to-back performance demands?
Hybrid – the Best of Both Worlds?
Is outsourcing or insourcing performance and attribution a mutually exclusive decision? It depends — you can have the best of both worlds by strategically sourcing different performance functions. Outsourcing official performance and insourcing attribution and other nuances (e.g., alternatives look-through exposure) is a model that has merit.
Outsource
Just as the ABOR can be commoditized and outsourced, the performance reporting associated with unit price returns can also be outsourced. Some firms have moved the performance function out of their teams and coupled them with other fund administrative and regulatory-type functions as part of an outsourcing arrangement. The extent to which firms outsource performance in the future is debatable — regional, client type, and client size differences are at play.
Insource
Attribution is more complex and may require the use of multiple models (e.g., decision-based attribution, custom models, attribution on unit prices). For these most complex scenarios, it makes sense to consider keeping attribution in-house for customization, control, and capability reasons.
However, the hybrid model has its shortcomings, including potential reconciliation issues between the performance and attribution data sets. This is where good data management is key! Of course, this can be monitored via tolerance thresholds; however, managing found exceptions can be a complicated and cross-functional task.
Nevertheless, reconciliation is an example of the complexity that a hybrid model introduces. The service providers are aware of this and are in varying phases of introducing new technologies and services in an attempt to address the concerns around reconciliations.
Like all things in life, deciding how to source your performance function is an exercise in trade-offs.
Attention performance managers! Cutter’s Performance Benchmarking survey is in field for a brief time. Participate to find out how you stack up against your peers. Check it out today.