Consolidation Within Active Management

Who do you think will survive the consolidation on the active side? What fund families do you see as having a leg to stand on? Do you think consolidation is coming in AM?

The argument is that active hasn’t been able to shine since vol has been relatively low for an extended period of time. As we see vol tick up, what happens if passive still outpaces active in the medium to long term? Just looking for some opinions.

 

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Any pros willing to rescue this discussion? @Justin-Kreindler" Rich-Cerruti MBA OCF223

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There may be some consolidation - in fact it may already be happening. More and more new Hedge Fund launched are failing within 5 years and less new Hedge Funds are launching.

However me and my colleagues are of the opinion that the active management industry will never disappear. There is a premium people will always willing to pay to have what they deem a talented manager do the investing for them, even if they under-perform. I do not, however, think that this means anyone is safe. Despite my previous comment on fewer launches, we are seeing some massive launches (e.g. ExodusP), and we are also seeing some very well respected fund shut down (Eton P).

 

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