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Two Sigma launches portfolio risk management solution for institutional investors


Two Sigma has launched Venn, a cloud-based investment analysis software platform. Venn was introduced initially on a limited, invite-only basis, but is now available to institutional investors and wealth managers among others.

For many institutional investors, the investment process today remains highly qualitative, with a reliance on spreadsheets or other inefficient tools that are slow to provide more complex analysis and can require hours of manual effort to build and maintain. These barriers to data-driven analysis can prevent investment teams from responding to management needs in a timely manner and increase the likelihood of human error.

“Two Sigma has spent nearly two decades bringing a scientific approach to the investment process,” says Carter Lyons, who leads Two Sigma’s investment products and solutions business. “We think we can take that same approach and help investors analyse their entire portfolio, not just the capital we help to manage.”

Venn applies Two Sigma’s expertise in technology and investment analysis to help investors leverage data to answer critical questions they face each day. At the core, Venn is designed to enable investors to gain a better understanding of investment risks and the role these risks play in meeting their investment objectives. This means that as investors seek to protect and grow the assets of leading research institutions, pensioners or even their advisory clients, they can gain confidence that the risks they’re taking are transparent and deliberate. Venn empowers investors to easily organise their data and collaborate more efficiently through a customisable cloud-based investment library, feeding a range of powerful analyses intended to highlight the dominant risk exposures across investments and sensitivity to drawdown scenarios.

“At Venn, we’ve seen the challenges investors face when trying to bring a modern, data-driven approach to managing their portfolios and meeting their long term objectives,” says Jake Dwyer, General Manager of Venn at Two Sigma. “We’ve been thrilled to see how Venn has increasingly transformed our clients’ investment processes and are excited to enable more investors to take advantage of the ways Venn can drive efficiency and empower their investment teams.”
Users of Venn today represent more than 200 institutions across pensions, endowments, insurers, family offices, funds of funds and RIAs, among others, that represent more than $5 trillion in combined AUM.

Some current clients include: Brown University, Grinnell College, Prudential Financial, Inc. and the State of Wisconsin Investment Board (SWIB).

Venn is currently offered in two tiers. For investors looking for powerful analysis of individual investments, Venn is free and includes access to over 100,000 public funds, stocks, and indices. It also offers exclusive access to the Two Sigma Factor Lens, the set of risk factors that powers many of Venn’s analyses.

Users looking for more robust, portfolio level analytics can take advantage of Venn Pro, a solution that is offered on a SaaS subscription model and includes additional features such as custodial integrations and portfolio optimisation and special access to product specialists on the Venn team at Two Sigma. Its more holistic view delivers personalised insights that are designed to be relevant to the investor and their stated long term investment objectives, providing insights intended to help them reduce risk and delve into performance attribution by investment or risk factor.

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