AvantGarde Financial Services (Pty) Ltd, is a registered South African company, and an authorised financial services provider (FSP License No: 23742). The company is a joint venture partnership between Jacques Malan Consultants and Actuaries, a firm with six offices across Southern Africa that has been providing professional advice and services to the retirement, insurance, and healthcare funding industries since 1995; and OTC Conseil South Africa, a subsidiary of OTC Conseil in France, that has been providing a range of specialist risk management and consulting services to the financial services industry in Europe, Asia, Africa and the United States of America since 1999.

Historically the focus of investments has been based on performance and trust. A noble foundation for the majority within an established industry, until the likes of Fidentia, Maddoff, Masterbond, High Derivative Exposure (Transvaal Joint Pension Fund) ... and the list continues. The point is that independent risk management and oversight is becoming as necessary as the independent audits, due diligence, and transparency in performance reporting required by the industry.

The above incidences highlight risks that retirement funds could be unknowingly exposed to. Firstly, asset managers reporting on having assets that they actually do not hold (Fidentia) and secondly the trustees and consultants do not fully understand the level or risk the funds are exposed to (Transvaal Joint Pension Fund).

Trustees also need to assess the risk associated with the asset manager that they select to manage their assets. An asset manager that takes big risks may very well deliver phenomenal returns in one year but by the same token could disappoint to the same extent the next year.

Over the medium to long term trustees require consistent returns, especially as individuals join and leave the fund at different times. It is only natural that members of the fund will be delighted with the upside potential that high risk can bring to a fund, but they will be less pleased with the potential for significant downside for which the trustees are also answerable. As a result of taking excessive risk your fund might be performing extremely well in Bull markets and extremely bad in Bear markets. Not taking enough risk will translate in very average returns.

One of the most basic principles of fair play in the industry is that people should never lose money through taking risks they did not agree to. The opposite is also true, people should not lose out on opportunities since an agreed risk was not taken.