At Keystone, we place significant emphasis on understanding the downside of each investment we make and mitigating such risks as far as possible.
As other investment groups may instead focus on how to squeeze every last incremental yield out of a particular investment, we tend to focus more on how we can further mitigate our risk of loss, which can often be accomplished through a variety of factors, including the pledge of additional collateral, guarantees, shorter investment duration, cross collateralization of assets, preexisting relationships with counterparties, personal guarantees, internal control procedures, and other methods.
Additionally, it is often our customary practice to involve multiple team members with divergent backgrounds on each transaction or investment decision. We frequently invite input from multiple team members on each investment under review and seek to create an environment in which each team member’s participation is valued. By creating an atmosphere in which all Keystone professionals can speak freely and contribute their experience and expertise, we believe our firm is able to make better investment decisions.
In addition to investment risk, we also seek to mitigate risk within our firm, which is accomplished through key monetary and other internal controls, especially with respect to custody of client assets, established operating policies and practices, insurance policies, and the engagement of independent fund administrators, auditors, and other professionals.