Mon, Aug 15, 2022
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
New Managers March 2012

The Analytical View
Several analysts discuss investing in new managers

 

Established fund firms out of favour among researchers

Emerging managers lap investment elephants: Ted Krum

Ted Krum

In his update paper on fund performance, No Contest: Emerging Managers lap investment elephants, Ted Krum, Vice President and senior investment program manager at Northern Trust, a large wealth and asset manager, may be talking about long-only funds, but, he told Opalesque, a lot of it applies to hedge funds too.

In his eighth study of emerging fund managers (in the last 20 years), which are defined as the smallest firms making up the last 1% of institutional market share, the paper finds that once again they often can provide better returns and, strikingly, better downside performance than the household names. By 2010, the median small manager outperformed the median large firm by 72 basis points per year; furthermore the largest investment firms kept on getting larger (even with weak returns).

"In the last 20 years, there were times when small managers did not outperform the large ones," he explains. "In particular, in a market environment which has a lot of liquidity being dumped onto the financial markets, some of the smaller managers may find it difficult to keep up because the bigger firms, in ever increasing concentration, will be making up the majority of the market."

But the consistency that he found each time in his research is the greater dispersion; emerging managers do not always outperform but their results are more dispersed with higher highs and lower lows.

"As larger firms make up the majority of......................

To view our full article please login

This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.
New Managers
New Managers
New Managers

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: Hong Kong manager expects additional tailwind in Asian markets[more]

    B. G., Opalesque Geneva: The Asia equity markets have not been at their best so far this year, with the MSCI Asia index down almost 13% YTD, but many managers remain buoyant about the region, as in

  2. Opalesque Exclusive: Emerging markets persist despite headwinds[more]

    Bailey McCann, Opalesque New York: Emerging markets have been under significant pressure since the start of the year, but there are some nascent trends that suggest that things could be getting better. Emerging markets firm Gramercy Fund Management recently released its third quarter outlook and

  3. Opalesque Exclusive: Castle Hall's DiligenceExchange free Transparency Reports cover 100 managers with $10tn of assets[more]

    Matthias Knab, Opalesque for New Managers: Managers and investors can get free access to DiligenceExchange here: https://bit.ly/DXCInfo Castle Hall, the Du

  4. Other Voices: ESG exuberance is at all-time highs. But will investors buy?[more]

    As investors increase their focus on mission-based investing, they continue to grapple with ESG and what it means to them. By David Shalom, Director of Capital Introductions at Pershing Innovation. New investment solutions. That's how managers deliver value and attract new inve

  5. Opalesque Exclusive: This European mezzanine debt strategy offers equity-like returns with downside protection[more]

    B. G., Opalesque Geneva for New Managers: Mezzanine financier SIG-i operates in a relatively uncrowded space by proactively manufacturing financing solutions as an alternative to traditional debt and equity instrume