Key Takeaways from the 2023 PMAR Conference

Sara Celapino
Manager
June 23, 2023
15 min
Key Takeaways from the 2023 PMAR Conference

TSG hosted the 21st annual Performance Measurement, Attribution & Risk (PMAR) North America Conference on May 24th - 25th 2023 in New Brunswick, New Jersey. Longs Peak had the pleasure of sponsoring the event and being represented on the Performance Reporting: Beyond the GIPS standards panel on day 2 of the conference by our very own Matt Deatherage, CFA, CIPM.

With many unanswered questions still circulating on the implementation of the SEC Marketing Rule that took effect last November, there were multiple sessions that touched on this topic. Other topics included ESG and its impact on performance, maximizing the potential of AI, performance evaluation and risk when returns aren’t normally distributed, evaluating benchmark misfit risk, and other hot topics such as talent retention and outsourcing.

With many women in the industry already attending PMAR, the conference also facilitated the first in-person Women in Performance Measurement (WiPM) meeting May 23rd. Longs Peak co-sponsored this event with TSG and sent four members of our team to the event. Interacting with so many brilliant women in different stages of their careers was a great experience, and the women of Longs Peak are looking forward to being part of the continued growth and development of the group.

ESG

ESG reporting requirements are ramping up, coming from pressure from shareholders and employees as well as in response to looming federal climate-disclosure regulations. The trend is no different for prospective investors as interest in ESG information is increasingly being requested by prospects. According to this WSJ article, “Nearly 80% of roughly 400 global institutional investors surveyed last year said companies should make investments that address ESG issues, even if doing so reduces profits in the short term.” The speaker reiterated this sentiment and said although the regulations in the US are behind Europe and Australia, he said that the SEC is getting there.

AI and Machine Learning in Investment Management

It is no secret that large language models (LLMs) like ChatGPT or BloombergGPT are increasingly being incorporated in investment management. LLMs offer powerful technologies that can be utilized for a variety of advancements from data analysis and research to providing valuable insights from financial reports and supporting decision-making. In addition, they can contribute to risk assessment, compliance, and portfolio management by analyzing data and optimizing strategies. It is our opinion that this technology will revolutionize the financial services industry and will do so rapidly.

Of course, the integration of AI and Machine Learning technology comes with advantages and disadvantages. While the technologies offer improved efficiency and accuracy, relying too heavily on this technology can introduce algorithmic biases that can impact investment decisions. As performance experts, we wonder if it will create an overreliance on historical data and as we know, past performance may not always be indicative of future results. Key takeaways from this session were to consider how your firm might utilize LLMs and Machine Learning in your own processes and that while this technology is still somewhat new, it is increasingly accessible to anyone at reasonable cost.

Performance Reporting: Beyond the GIPS Standards

The panel discussed the types and frequency of performance they’re seeing internally and externally. Depending on the asset class, monthly or quarterly external reporting is most common, while some portfolio managers have found value in utilizing daily reporting internally to see how their strategies are performing in real-time. Firms seem to be steering away from manual updates and relying more heavily on automation and external resources for reporting. Beyond the statistics required by the SEC, including visuals in their reports was touched on by the panel as well as focusing on the story the firm is looking to tell based on the goals of the specific strategy.

Firms distributing performance also need to consider the internal controls needed to ensure that they are presenting accurate performance relevant to the specific audience. The importance of audit logs and extensive internal review was stressed, and firms are constantly looking for ways to improve these processes and save time. These challenges extend to updating databases in a timely and efficient manner, with some firms opting to upload preliminary performance to meet database deadlines and then making retrospective changes as needed.

While Excel is still king in the performance world, utilizing performance systems for calculation and reporting can create efficiencies and reduce opportunity for manual error. Flexibility is key, as end users want to be able to customize reporting for their specific needs. The ultimate reporting goal for many firms seems to be aggregating performance and risk statistics from different sources, and firms have found success using dashboards and other technology to simplify these processes.

SEC Insights

With many of our clients being SEC-registered investment firms, we’ve been just as eager as the rest of the industry for additional guidance on the SEC Marketing Rule. Unfortunately, it sounds like it may be a while until additional FAQs are released. One requirement that has raised many questions is the requirement to present performance net-of-fees. “Performance” isn’t defined by the SEC, so the PMAR panel, focused on extracted performance and attribution, attempted to shed some light on what could be considered performance under the new SEC guidelines.

It's been made clear that the net performance requirement applies not only to performance of an entire composite or portfolio, but also to that of a subset of investments or a single investment. If the gross performance of a single investment is shown, net performance also needs to be presented. When presenting extracted performance, firms should apply a model fee to calculate the net return, include appropriate disclosures, and be able to support why they’re presenting this information.

This gets a little trickier when considering attribution, and many firms are still figuring out how to navigate this grey area. The SEC will likely want to see attribution net-of-fees in some cases but not others. For now, it seems providing clear documentation for what’s shown and why is key. According to the panel, things like average weight and Sharpe ratio seem less likely to be considered performance, while contribution to return seems more likely to be considered performance. Yield in particular was discussed in detail, with the takeaway being that if yield is presented in a way that it is synonymous with a return and what investors can expect to take home, this may be subject to the net performance requirement.

Some other takeaways from this panel discussion on attribution are that metrics derived from performance and those that are relative to a benchmark are less likely to be considered performance in the eyes of the SEC. Firms should be able to support their decision of what they consider performance and be aware of the context in which attribution is being presented.

This panel also touched on key deficiencies from recent SEC exams, as well as what to expect for the next round of exams. While Phase I focused on more evaluating whether firms were addressing the new rule, Phase II is expected to include a deep dive across 175-200 firms. This will also include 20-25 exams involving recalculation of performance, as well as a focus on predecessor performance and testimonials/endorsements.

Some of the deficiencies the panel touched on from Phase I were material misstatements in advertisements, manipulation of performance, omitting poor performance, and failure to present net-of-fee performance. Another deficiency noted was the lack of policies and procedures around presenting hypothetical performance. The key to presenting hypothetical performance is that recipients must be able to fully understand what is being shown, and that this performance is not being distributed to a retail audience. You also need to have the ability to recreate any hypothetical performance presented, as this has the potential to be tested by the SEC.

To get ready for the next phase of SEC exams, firms should make sure their policies and procedures are designed to prevent violations of the marketing rule and that their marketing materials comply. We recommend extending this review to your website to ensure historical information published prior to adoption of the new rule is also in compliance. One suggestion from the panel was to leverage other firms in the industry to see what types of disclosures are being used. Many large firms are putting a lot of time and resources into navigating the marketing rule, so leveraging these firms as best practice is encouraged.

WiPM Group

Officially launched in late 2022, the Women in Performance Measurement (WiPM) Group was developed as a resource for women in the investment performance industry to connect with, learn from, and uplift one another. With initial members of the group spread across multiple regions and countries, the first in-person meeting had an impressive turnout of over 50 attendees.

The meeting featured Lisa Kaplowitz as its keynote speaker. Kaplowitz is a professor at Rutgers Business School and is the Executive Director at Rutgers Center for Women in Business. Her background includes everything from taking part in the landmark Title IX case to multiple CFO positions. Throughout her career, Kaplowitz has remained a champion of women and challenging the status quo.

Kaplowitz shared statistics supporting that the majority of women in C-suite positions competed in athletics, with nearly half of those executives being previous college-level athletes. This connection may not be all that surprising when you consider the life lessons around discipline, resiliency, and teamwork that are taught through athletics and the valuable leadership skills that are developed through those experiences. She also offered some insightful information on maladaptations women have to endure to survive in the workforce today and offered suggestions for addressing them. This topic really seemed to resonate with the group.

Another topic discussed was how to make the workplace “work” for women, which led to some insightful conversations during the WiPM panel discussion that touched on work life balance and the unique challenges women face in the workforce, particularly the performance measurement industry.

The group is working out details of a mentorship program that will help facilitate relationships between women across the industry and allow them to share the knowledge and experience gained throughout their careers. This program is expected to launch in the fall of 2023 and is open to all women within the WiPM group.

Anyone interested in the WiPM Group is encouraged to contact us to get connected.

Conclusion

This year’s PMAR speakers offered a lot of great insights on topics related to investment performance measurement and challenges facing the industry.

We enjoyed connecting with other performance measurement professionals in-person and are looking forward to attending future PMAR and WiPM events.

If you have any questions about the 2023 PMAR Conference topics or GIPS compliance and performance measurement in general, please contact us.

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Key Takeaways from the 2025 PMAR Conference
This year’s PMAR Conference delivered timely and thought-provoking content for performance professionals across the industry. In this post, we’ve highlighted our top takeaways from the event—including a recap of the WiPM gathering.
May 29, 2025
15 min

The Performance Measurement, Attribution & Risk (PMAR) Conference is always a highlight for investment performance professionals—and this year’s event did not disappoint. With a packed agenda spanning everything from economic uncertainty and automation to evolving training needs and private market complexities, PMAR 2025 gave attendees plenty to think about.

Here are some of our key takeaways from this year’s event:

Women in Performance Measurement (WiPM)

Although not officially a part of PMAR, WiPM often schedules its annual in-person gathering during the same week to take advantage of the broader industry presence at the event. This year’s in-person gathering, united female professionals from across the country for a full day of connection, learning, and mentorship. The agenda struck a thoughtful balance between professional development and personal connection, with standout sessions on AI and machine learning, resume building, and insights from the WiPM mentoring program. A consistent favorite among attendees is the interactive format—discussions are engaging, and the support among members is truly energizing. The day concluded with a cocktail reception and dinner, reinforcing the group’s strong sense of community and its ongoing commitment to advancing women in the performance measurement profession.

If you’re not yet a member and are interested in joining the community, find WiPM here on LinkedIn.

Uncertainty, Not Risk, is Driving Market Volatility

John Longo, Ph.D., Rutgers Business School kicked off the conference with a deep dive into the global economy, and his message was clear: today’s markets are more uncertain than risky. Tariffs, political volatility, and unconventional strategies—like the idea of purchasing Greenland—are reshaping global trade and investment decisions. His suggestion? Investors may want to look beyond U.S. borders and consider assets like gold or emerging markets as a hedge.

Longo also highlighted the looming national debt problem and inflationary effects of protectionist policies. For performance professionals, the implication is clear: macro-level policy choices are creating noise that can obscure traditional risk metrics. Understanding the difference between risk and uncertainty is more important than ever.

The Future of Training: Customized, Continuous, and Collaborative

In the “Developing Staff for Success” session, Frances Barney, CFA (former head of investment performance and risk analysis for BNY Mellon) and our very own Jocelyn Gilligan, CFA, CIPM explored the evolving nature of training in our field. The key message: cookie-cutter training doesn't cut it anymore. With increasing regulatory complexity and rapidly advancing technology, firms must invest in flexible, personalized learning programs.

Whether it's improving communication skills, building tech proficiency, or embedding a culture of curiosity, the session emphasized that training must be more than a check-the-box activity. Ongoing mentorship, cross-training, and embracing neurodiversity in learning styles are all part of building high-performing, engaged teams.

AI is Here—But It Needs a Human Co-Pilot

Several sessions explored the growing role of AI and automation in performance and reporting. The consensus? AI holds immense promise, but without strong data governance and human oversight, it’s not a silver bullet. From hallucinations in generative models to the ethical challenges of data usage, AI introduces new risks even as it streamlines workflows.

Use cases presented ranged from anomaly detection and report generation to client communication enhancements and predictive exception handling. But again and again, speakers emphasized: AI should augment, not replace, human expertise.

Private Markets Require Purpose-Built Tools

Private equity, private credit, real estate, and hedge funds remain among the trickiest asset classes to measure. Whether debating IRR vs. TWR, handling data lags, or selecting appropriate benchmarks, this year's sessions highlighted just how much nuance is involved in getting private market reporting right.

One particularly compelling idea: using replicating portfolios of public assets to assess the risk and performance of illiquid investments. This approach offers more transparency and a better sense of underlying exposures, especially in the absence of timely valuations.

Shorting and Leverage Complicate Performance Attribution

Calculating performance in long/short portfolios isn’t straightforward—and using absolute values can create misleading results. A session on this topic broke down the mechanics of short selling and explained why contribution-based return attribution is essential for accurate reporting.

The key insight: portfolio-level returns can fall outside the range of individual asset returns, especially in leveraged portfolios. Understanding the directional nature of each position is crucial for both internal attribution and external communication.

The SEC is Watching—Are You Ready?

Compliance was another hot topic, especially in light of recent enforcement actions under the SEC Marketing Rule. From misuse of hypothetical performance to sloppy use of testimonials, the panelists shared hard-earned lessons and emphasized the importance of documentation. This panel was moderated by Longs Peak’s Matt Deatherage, CFA, CIPM and included Lance Dial, of K&L Gates along with Thayne Gould from Vigilant.

FAQs have helped clarify gray areas (especially around extracted performance and proximity of net vs. gross returns), but more guidance is expected—particularly on model fees and performance portability. If you're not already documenting every performance claim, now is the time to start.

“Phantom Alpha” Is Real—And Preventable

David Spaulding of TSG, closed the conference with a deep dive into benchmark construction and the potential for “phantom alpha.” Even small differences in rebalancing frequency between portfolios and their benchmarks can create misleading outperformance. His recommendation? Either sync your rebalancing schedules or clearly disclose the differences.

This session served as a great reminder that even small implementation details can significantly impact reported performance—and that transparency is essential to maintaining trust.

Final Thoughts

From automation to attribution, PMAR 2025 showcased the depth and complexity of our field. If there’s one overarching takeaway, it’s that while tools and techniques continue to evolve, the core principles—transparency, accuracy, and accountability—remain as important a sever.

Did you attend PMAR this year? We’d love to hear your biggest takeaways. Reach out to us at hello@longspeakadvisory.com or drop us a note on LinkedIn!

ColoradoBiz Names Longs Peak’s Jocelyn Gilligan, CFA, CIPM as a Gen XYZ Top Young Professional
Longs Peak is pleased to announce that Partner and Co-Founder, Jocelyn Gilligan has been named a GenXYZ Top Young Professional by ColoradoBiz Magazine. As ColoradoBiz states, “They’re uncommon achievers, whether as entrepreneurs, CEOs, nonprofit leaders, visionaries critical to their companies’ success or, in some cases, all of those roles. This year’s Top 25 Young Professionals figure to continue making a difference professionally and in their communities for years to come.”
March 14, 2023
15 min

Longs Peak is pleased to announce that Partner and Co-Founder, Jocelyn Gilligan has been named a GenXYZ Top Young Professional by ColoradoBiz Magazine.

As ColoradoBiz states, “They’re uncommon achievers, whether as entrepreneurs, CEOs, nonprofit leaders, visionaries critical to their companies’ success or, in some cases, all of those roles. This year’s Top 25 Young Professionals figure to continue making a difference professionally and in their communities for years to come.”

Jocelyn grew up in Boulder, CO and graduated from the University of Colorado. She started her career at Ernst & Young in New York City where she worked on their Financial Services Transfer Pricing Team. She transferred with EY to their office in Shanghai and then eventually to Hong Kong. Jocelyn left EY as a Manager and relocated back to Colorado where she and her husband started a family. Soon thereafter, Jocelyn and Sean founded Longs Peak out of a small one-car garage in their home in Longmont, CO. Now running a thriving team of 14, Jocelyn has weathered the ups and downs of entrepreneurship. She credits a lot of their success to their amazing team and the community of entrepreneurs they live near and network with (Longs Peak is an active member of EO (Entrepreneurs Organization)).

Jocelyn is a voting member of the PTO at her children’s school and a member of Women in Investment Performance Measurement, a group recently founded to support women in the investment performance industry.

About ColoradoBiz’s Top 25 Young Professionals

The 13th annual Gen XYZ awards is open to those under 40 who live and work in Colorado — numbered in the hundreds, making for difficult decisions and conversations among judges, as always. Applications were judged by our editorial board based on career achievement, community engagement and their stories of how they got to where they are now.

About Longs Peak

Longs Peak is a purpose and values-driven company. It is our mission to make investment performance information more transparent and reliable—empowering investors to make better, more informed investment decisions.

At the onset, we were looking to help smaller investment managers by giving them access to professional performance experts and tools typically only available to very large firms. We know that our work enables emerging managers to compete with the big guys and helps facilitate their growth. We strive to be our clients’ most valued outsource partner and to be known for our exceptional client service. We know that providing exceptional client service means that we must first create a culture that lives by the ideals we are trying to create for our clients. A place where incredibly talented individuals are empowered to put their best work into the hands of clients that truly value what we do. As a firm, we recognize that our greatest asset is people – both those we work with and those we work for. We continue to evolve into something that represents the needs of both of these groups and hope someday a GIPS Report is provided to every prospective investor in the world.

SEC Clarifies Marketing Rule: Gross-of-Fee Returns Allowed Under Certain Conditions
The investment management industry has spent significant time grappling with the SEC’s Marketing Rule and the question of whether gross-of-fee returns can be presented without corresponding net-of-fee returns in certain cases. Many firms have invested resources in trying to allocate fees to individual securities and sectors in an effort to comply. However, the SEC has now issued two FAQs (March 19, 2025) that provide much appreciated clarity on extracted performance and portfolio characteristics. The key takeaway? It is possible to present gross-of-fee returns without net-of-fee returns—if certain conditions are met.
March 27, 2025
15 min

The investment management industry has spent significant time grappling with the SEC’s Marketing Rule and the question of whether gross-of-fee returns can be presented without corresponding net-of-fee returns in certain cases. Many firms have invested resources in trying to allocate fees to individual securities and sectors in an effort to comply. However, the SEC has now issued two FAQs (March 19, 2025) that provide much appreciated clarity on extracted performance and portfolio characteristics. The key takeaway? It is possible to present gross-of-fee returns without net-of-fee returns—if certain conditions are met.

Extracted Performance: Gross Returns Can Stand Alone Under Specific Criteria

Investment advisers often present the performance of a single investment or a subset of a portfolio (“extracted performance”) in marketing materials. Historically, the SEC required both gross and net performance to be shown for such extracts. The new guidance provides a pathway for firms to display only gross-of-fee extracted performance, provided the following conditions are met:

  1. The extracted performance must be clearly identified as gross performance.
  2. The advertisement must also present the total portfolio’s gross and net performance in a manner consistent with SEC requirements.
  3. The total portfolio’s performance must be given at least equal prominence to, and facilitate comparison with, the extracted performance.
  4. The total portfolio’s performance must be calculated over a period that includes the entire period of the extracted performance.

If these conditions are satisfied, the SEC staff has indicated they will not recommend enforcement action, even if the extracted performance is presented without corresponding net returns. This is a notable shift, as it allows firms to avoid the complex and often impractical task of allocating fees at the investment or sector level.

Portfolio and Investment Characteristics: Net-of-Fee Not Always Required

Another common industry question has been whether certain portfolio or investment characteristics—such as yield, volatility, Sharpe ratio, sector returns, or attribution analysis—constitute “performance” under the marketing rule, and if so, whether they must be presented net of fees.

The SEC’s latest guidance acknowledges that calculating these characteristics net of fees can be difficult and, in some cases, may lead to misleading results. As a result, the staff has confirmed that firms may present gross characteristics alone, without net characteristics, if they meet the following criteria:

  1. The characteristic must be clearly identified as calculated without the deduction of fees and expenses.
  2. The advertisement must also present the total portfolio’s gross and net performance in a manner consistent with SEC requirements.
  3. The total portfolio’s performance must be given at least equal prominence to, and facilitate comparison with, the gross characteristic.
  4. The total portfolio’s performance must be calculated over a period that includes the entire period of the characteristic being presented.

As with extracted performance, these conditions help ensure that the presentation is not misleading, reducing the risk of enforcement action.

Bottom Line: A Practical Path Forward

This updated SEC guidance provides much-needed flexibility for investment managers, allowing for the presentation of gross-of-fee returns in a compliant manner. Firms that clearly disclose their approach and follow the specified conditions can reduce compliance burdens while still meeting investor protection standards. While this does not eliminate all complexities of the Marketing Rule, it does offer a practical solution that allows for more straightforward and meaningful performance reporting.

For firms navigating these changes, ensuring clear disclosures and maintaining compliance with the general prohibitions of the rule remains critical. Those who align their advertising materials with these guidelines can now confidently use gross-of-fee performance in a way that is both transparent and in compliance with regulatory requirements.

Questions?

If you have questions about calculating or presenting investment performance in a manner that complies with regulatory requirements or industry best practices, we would love to talk to you. Please feel free to email us at hello@longspeakadvisory.com.