Ranking the top Asset Management firms

Obviously it's easy to rank AM firms in terms of their AUM which gives a glimpse into their standing, but how would you rank them in terms of their exit opportunities and overall prestige?

 
Best Response

You would have to break it down by asset class and even strategy within each asset class. There is no such thing as one firm that is #1 across the board. In fact, it is very uncommon for a firm that is strong in one asset class (i.e. public equities, fixed income, real estate, private equity, VC, etc.) to be strong in another. Even within a given asset class, there are often different strategies and areas of focus i.e. EM growth equities, U.S. small cap value, international value, on and on.

 
thebrofessor:
in my opinion: JPM

Would you consider either of them top tier though? Our strength is EM equity, and I view our US FI business as middling to upper middling, and never hear either name mentioned by Sales in FI conversations. (Granted, I'm in US Equity ETFs, so I'm rather removed from the conversation)

The only difference between Asset Management and Investment Research is assets. I generally see somebody I know on TV on Bloomberg/CNBC etc. once or twice a week. This sounds cool, until I remind myself that I see somebody I know on ESPN five days a week.
 

What AM would you say has the best in the following strategies?

  1. High yield special debt Funds?

  2. Emerging Markets - Domestic Currency Small Cap Funds?

  3. Distressed Muni Equity Situations Funds?

  4. Large Intrinsic Value Funds?

  5. Small Intrinsic Value Funds?

  6. Mid-Sized Intrinsic Value funds?

  7. Mid to Large-Sized Intrinsic Value Funds?

  8. Pretty Big, but not THAT Big Intrinsic Value Funds?

 

A few of your listed strategies are too specialized.

Distressed municipal would likely be rolled into a distressed firm, likely one with government debt orientation. High yield special debt likely falls in the distressed sector too, or a non-investment grade debt specialist (corporate, government, etc.)

"The power of accurate observation is commonly called cynicism by those who have not got it." - George Bernard Shaw
 

You can't judge funds by prestige. They all have different investment philosophies and different objectives.

There are some brand names that deliver on their promises because they have good systems and a strong talent pipelines. However there are many superstar PMs who prefer smaller shops because they can react faster with less red tape and have more autonomy. There are also some large firms with brand names that have worse resources than most smaller firms counterintuitively.

The investment philosophy and training are key. If you love fundamental investing, a place like BlackRock might not be a good move given they are pivoting towards quant.

 

Sorry if I am not asking in the proper thread, I did not want to create one for juste one question.

Why don't we find Barclays in the Asset Managers ranking by AUM (Just Google IPE TOP 400 Asset Managers 2017 for instance)

I can't believe they manage less than 4 bn €

 

Disclaimer: I only have 3 years of experience in the industry so I am not necessarily correct, plus it's all opinions. Either way, I think rankings should go by category

Traditional AM firms BlackRock, Fidelity, Wellington, T. Rowe Price, MFS, Capital Group, PIMCO These firms recruit almost exclusively at top MBA programs (and most of the time HSW + Chicago) and take a few undergrads from top schools a year.. They can afford to be VERY selective and really cherry pick because they only hire a few a year.

BB AM arms GSAM, JPMAM Relatively easier to land a job at BB AM arms because of the slightly bigger hiring needs and some comparatively less desirable positions. For instance, BBs do quite a bit more FoF work than the traditional AM firms and you might get stuck in those positions. Also, BB tend not to distinguish their AM analyst class when they are hiring. I have heard stories about being stuck in a product management/institutional sales type of role while being given the impression that they would be doing investment.

Hedge funds are a mixed bag. It is really hard to rank but you have your most prestigious ones like Paulson, DE Shaw, Citadel,Bridgewater, Tudor etc

 
gelukkig:
why many people think FoF is worse than fund investing in stocks?
The transferable skillset you gain from direct investment analysis is exponentially better than FoF work. You can always go from investment to FoF while the other way, while possible, is much harder because of the skill set.
gelukkig:
why many can assume product management/institutional sales is less rewarding/interesting than portfolio managers?
Interesting question. I am not saying one is superior to the other, but at any AM firms, the focus is pretty much always on the investment organization. The investment professionals are the center of the universe within the firm, Everything else really cater to them. Can a fund run without product management? Probably not as well. Can a fund run without sales? Absolutely not. But that doesnt mean the hierarchical order isnt there. Also, all else being equal, an investment professionals make quite a bit more than product management and sales professionals (i mean comparing an junior research analyst with 3 years under his belt vs a product manager/sales guy with the same amount of experience) also, this is personal experience. Based on what I see, research associates/junior research analysts enjoy much better success applying to top MBAs than the product management/sales counterparts.
 

The prestige of the firm depends a lot on your position. At the analyst / associate level, GSAM is probably the most prestigious because of the Goldman Sachs name and the difficulty of getting a job there (in certain groups). At more senior levels, group performance factors heavily into prestige, so the rankings fluctuate pretty much with each business cycle. For instance, GSAM is overall doing pretty badly right now, so working right under the senior people there doesn't look so great. When you're at that point in your career, and if you're still in asset management, then you will know where the hot places are.

  • EDIT *

I didn't realize you included hedge funds there. Pretty much any established hedge fund is more prestigious than any other type of asset management group at the junior level. My ranking (of prestige at the junior level, not performance):

  1. Renaissance Technologies
  2. D.E. Shaw
  3. Citadel
  4. Paulson & Co.
  5. Top BB groups

For example, top BB group would include GSIP and QIS within GSAM and Highbridge Capital within JPM (well, quasi-within).

 

What I find funny about those working at the traditional AM firms is that despite recruiting people with supposed smarts (i.e. out of HSW and top MBA programs) most of the mutual funds (Fidelity in particular) seem to do shit relative to their benchmark index. The supposed alpha we should see from active management other than a select few mutual funds just isn't present. Other than the Magellan fund when it was run by Peter Lynch many moons ago, I've been thoroughly disappointed in mutual funds overall. Especially when you factor in tax issues, index funds are the way to go.

 

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