Portfolio Look-Through

Look-through analysis moves beyond fund labels to understand what a portfolio truly owns: sectors, geographies, factor exposures, leverage, and overlapping positions across managers.

For allocators, look-through is essential because diversification on paper can become correlation in reality.

How allocators define look-through exposure

They analyze:

• Overlap risk: same assets held across multiple managers or vehicles
• Sector/geo concentration: hidden clustering in themes
• Factor exposures: growth/value, duration, credit beta, liquidity beta
• Leverage stacking: leverage layered across funds and portfolio companies
• Liquidity profile: ability to raise cash when needed
• Vintage and pacing: concentrated exposure to one macro regime

Allocator framing:
“What are we actually exposed to—across the full stack?”

How it fits into allocator workflows

Used to:

• Prevent unintended concentration
• Improve pacing and rebalancing decisions
• Understand drawdown drivers and stress behavior
• Support governance reporting and IC decision-making

What slows decision-making

• Incomplete data from managers
• Inconsistent classification and mapping standards
• Time lags and stale holdings data
• Difficulty reconciling exposure across structures

Common misconceptions

• “Multiple managers means diversified” → overlap can be massive.
• “Fund labels reflect holdings” → mandates drift; exposures change.
• “Look-through is only for public markets” → private exposures can cluster too.

Key allocator questions

• Where is overlap and how big is it?
• What is aggregate exposure to one sector/theme?
• What is liquidity in a drawdown scenario?
• Are we stacking leverage unknowingly?
• What is the true risk budget usage by driver?