It is often said that attribution should mirror the investment decision-making process if it is to be useful in providing feedback to its participants. This paper argues, however, that the decision to hold a certain security at a certain weight, and the resulting asset allocation/stock selection effects, are actually the outcome of myriad decision-points, and that much is to be gained from understanding the process by which these positions are actually arrived at. Process attribution offers a simple and intuitive framework to supplement existing attribution techniques, providing a more longitudinal view of a portfolio and its construction. This paper reintroduces the topic and demonstrates how it may be useful for analysts, portfolio managers and CIOs alike.

Process Attribution: Revisiting Equity Attribution and Decision Making