Identifying the characteristics of great investment managers
Identifying the attributes of a great investor is fundamental to the investment process. For an institutional investor, manager selection is a key decision. Equally, one of the characteristics of a successful asset management firm is the ability to understand who are the most talented managers within the firm - and to give them the greatest opportunity to influence portfolio alpha.
In the list below, the Savvy research team has curated the best papers on this topic, including some thoughtful insights penned by Michael J. Mauboussin of Credit Suisse. Join Savvy Investor today for free access to all of these papers - it's entirely free!
Reflections on the Ten Attributes of Great Investors (Michael J. Mauboussin)
Based on his vast investment industry experience, Michael Mauboussin shares his wisdom on the 10 key attributes of great bottom-up investors in this 20-page research note.
Global Investment Management Fees: Savings and Challenges (bfinance, May 2017)
This new bfinance report reveals falling fees in several sectors, especially where providers have been under pressure from cheaper competitors or the investment landscape has evolved.
Hallmarks of Successful Active Equity Managers (Cambridge Associates)
What steps can institutional investors take to increase their chances of selecting such a high-performing active equity manager? This 20-page report from Cambridge Associates suggests key attributes to look for.
Not All Active Managers Are Created Equal (Columbia Threadneedle)
What makes a great investor? The authors of this paper examine the key factors that generate sustained active investment alpha.
Active Share & Active Management: Skill, Conviction, Opportunity (CFA Institute)
This article by Martijn Cremers, Professor of Finance at the University of Notre Dame (Indiana), relates Active Share to the fund manager's individual stock-picking skill, conviction, and opportunity.
Five Questions Insurers Should Ask When Hiring Asset Managers (HIMCO, 2015)
Insurance asset management requires skills beyond regular asset management. The authors compile 5 key questions that insurers should ask to determine if an asset manager understands the complexities of serving an insurance client.
Does Past Performance Matter? The Persistence Scorecard (S&P Dow Jones Indices)
Demonstrating the ability to outperform peers repeatedly is the only proven way to differentiate a manager’s luck from skill. This paper by S&P Dow Jones Indices explores this in further detail.
Manager Selection (CFA Institute Research Foundation, 2013)
This comprehensive book is free to access, and helps investors to sharpen their manager selection ability, reviewing the process for manager selection for different mandates, including active, passive and alternative funds.
Capacity Management for Institutional Asset Owners (CIFR, 2016)
This paper examines the management of capacity from the perspective of an institutional asset owner running a multi-asset portfolio.
Do Asset Managers owned by banks deliver inferior investment performance?
In this paper, Miguel A. Ferreira, Pedro Matos and Pedro Pires examine the performance of equity mutual funds run by fund management divisions of commercial banking groups using a global sample.
Discovering Phi: Motivation as the Hidden Variable of Performance (State Street)
This paper explores motivation theory and the nature of motivation in investment management firms. It examines how investment managers can improve their “phi” (purpose, habits and incentives) in order to generate better outcomes.
ESG Under Scrutiny: Lessons from Manager Selection (bfinance, 2016)
The authors of this bfinance paper take a deep look at two recent manager searches and reveal practical challenges and lessons for ESG manager selection, in the end, sustainability integration.
Hedge Fund Investing: Manager Selection and Due Diligence (Merrill Lynch, 2015)
The authors of this paper review the challenges and importance to investors of hedge fund manager selection, through careful due diligence and skillful manager selection.
Picking winners? Investment consultants' recommendations of fund managers (2013)
This paper uses survey data to analyze what drives consultant recommendations on institutional funds, the extent of the impact on flow of said recommendations, and the extent of the value said plans add to plan sponsors.