how global investment performance standards gips work
the global investment performance standards are a set of standardized industry wide ethical principles that guide investment firms on how to calculate and present their investment results to prospective clients according to the cfa institute because the standards are voluntary investment firms can choose to comply with them or not however because the standards are in wide use worldwide complying with them makes it easier for investment firms to do business in multiple countries saving them the time of having to apply different performance calculation measures for investment presentations depending on the locale the cfa institute says the standards investment management companies often make a point of indicating that they are gips compliant that can lend additional credibility to companies especially those that do business outside the more mature markets of north america and europe history of global investment performance standards gips the forerunner of the global investment performance standards was the association for investment management and research performance presentation standards aimr pps created in 1987 this was a set of voluntary performance guidelines for investment management firms in the united states and canada in response to the need for a more international set of guidelines the global investment performance standards were first introduced in 1999 in 2005 the cfa institute as the association for investment management and research had been renamed approved a revised set of guidelines to create a single global standard of investment performance and replace the previous country specific performance standards the most recent edition of global investment performance standards was released on june 30 2019 and goes into effect on jan 1 2020 according to the cfa institute the global investment performance standards are currently used in more than 40 markets globally and 84 of the top 100 asset management firms worldwide claim compliance with the gips standards for all or part of their business combined the top 100 gips compliant firms represent more than us 50 trillion of assets under management 