MAGNA's transition management program consists of far more than an isolated trade during the normal course of a trading session; we take on the role of fiduciaries and intensely manage the process. The three primary areas of risks that a plan sponsor encounters when trying to transition large quantities of securities in a very short period of time are tracking risk, impact and liquidity risk and information risk. Tracking risk is the risk that the assets are being bought for the destination managers outperform the assets that are being sold before the transition is complete. Impact and liquidity risk is the risk that the relationship between liquidity and impact is unstable and subject to violent swings. Information risk is the risk that information associated with a transition is made know to the market.

In order to ensure a very smooth transition, we develop a time-line schedule so that coordination of all of the moving parts is clearly defined before the trading process begins. Through sophisticated pre-trade analysis we can project the total costs of transitioning portfolios versus the typical costs of an un-managed transition and lay out the cost savings. Through our ability to source liquidity, our sophisticated trading systems and our experienced talent in this niche, we create trading strategies designed to minimize market impact while simultaneously capitalizing on market momentum. Our post-trade analysis measures components of the Implementation Shortfall and compares our performance to all applicable metrics within the
asset class.