Manager Selection & Mandates

Manager Selection & Mandates - Articles & White Papers

White papers and research on fund manager selection and investment mandates. The most popular reports in this section examine the science and art of manager selection (i.e. the factors to consider when selecting managers), describe the hallmarks of successful active managers and provide questions asset owners (e.g. pension funds, endowments or insurers) should ask when hiring asset managers. This section also includes the process of manager selection and due diligence for picking hedge fund winners and analyzes investment consultants' "alpha" in their recommendations of fund managers. More focused papers examine transition management and the process of hiring asset managers to manage insurance assets. Other articles cover active equity management, the active versus passive debate, how to select commodity trading advisors, and research on asset management fees and fee structures.
  • Credit Suisse

    Reflections on the Ten Attributes of Great Investors (Michael J. Mauboussin, Aug 2016)

    Thirty years ago this year, Michael J. Mauboussin started on Wall Street. It goes without saying that he has seen dramatic events and change during that time. Equity market indices are roughly 10 times higher today than they were in 1986. And of the 10 biggest companies by market cap then, only AT&T, Exxon Mobil and GE remain in that league today. In this piece, he shares his ...

    • Professional
    • Views: 3149
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  • Cambridge Associates

    Hallmarks of Successful Active Equity Managers

    How can investors select active equity managers to maximize their odds for success? While there are no silver bullets in active equity manager selection, some managers have generated attractive long-term performance that exceeds both their benchmarks and management fees. This 20 page document from Kevin Ely of Cambridge Associates highlights key characteristics to look ...

    • Professional
    • Views: 2051
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  • BlackRock

    Enhance your skill: how active managers are using factor strategies (BlackRock, 2017)

    How are asset managers using factors to optimize active strategies?

    Factor investing continues to grow at a rapid pace, with almost $34 billion globally flowing into smart beta ETFs since the beginning of 2017.  Asset managers are taking notice, and many are already using factors to enhance their investment process. 

    Through the lens of three compelling case ...

  • eVestment

    Manager Selection: Shining a Light on Shadow Searches (eVestment, May 2017)

    In the past few years, there has been a significant shift in how institutional investors and consultants are approaching manager selection and research. Open calls for RFPs are becoming less common as consultants and investors are using databases to pre-screen managers, create shortlists and invite only a select group to participate in the RFP or finals process. This practice has ...

    • Professional
    • Views: 1223
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  • QMA

    The Long and the Short of It: The Quant Shorting Advantage (QMA)

    • 04 Oct 2016
    • Company: QMA

    Active extension, equity long-short, and equity market neutral products can be attractive for investors at any particular time, given investors' varied investment objectives and needs. That said, each of the three categories of shorting-enabled products can help address distinct issues facing investors today. QMA’s paper describes how short selling can allow investors to ...

    • Introductory
    • Views: 1251
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  • The Gordon Gekko Effect: The Role of Culture in the Financial Industry (2016)

    In this paper, Andrew W. Lo argues that although "culture" is a powerful force in shaping behavioral patterns of both individuals and groups, it has received very little attention in the context of financial risk management, as demonstrated by the recent global financial crisis. Lo presents a brief overview of the role "culture" plays, according to economists, ...

  • CFA Institute Research Foundation

    Manager Selection - CFA Institute Research Foundation (2013)

    Author: Scott Stewart

    Manager selection is a critical step in implementing any investment program. Investors hire portfolio managers to act as their agents, and portfolio managers are then expected to perform to the best of their abilities and in the investors’ best interests. Investors must practice due diligence when selecting portfolio managers. They need to not only ...

    • Professional
    • Views: 1140
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  • Merrill Lynch Wealth Management

    Hedge Fund Investing: Manager Selection and Due Diligence (Merrill Lynch, 2015)

    Hedge fund investments, which have in the past provided strong risk-adjusted returns uncorrelated to traditional investments, can potentially add significant value to an investor’s portfolio. These benefits can be gained through careful due diligence and skillful manager selection because hedge fund manager returns are so widely dispersed. To help qualified clients and ...

  • HIMCO (Hartford Financial)

    Five Questions Insurers Should Ask When Hiring Asset Managers

    In this 2014 paper, the authors have compiled a list of five key questions insurers should consider in determining if an asset manager fully appreciates the demands of serving an insurance client. While a manager’s history of strong investment performance and broad array of investment skills may deserve consideration, is the manager fully versed in the often complex ...

  • eVestment

    Enhancing Private Equity Manager Selection with Deeper Data (eVestment)

    The importance of selecting top quartile private equity funds has never been more clear – there is a significant cost of not being in these funds and historically those below the top quartile have not materially outperformed public markets. This white paper explores the research and data behind why top quartile returns are in the hands of the investor and presents advice and ...

  • The Carlyle Group

    Skill vs. Luck in Private Equity Investors’ Hunt for Excess Returns (The Carlyle Group, June 2017)

    Most investors are keenly aware that private equity returns differ substantially not only across funds but can also vary significantly from fund to fund over time. Although some fund managers have generated consistently superior returns for their investors, the generally limited degree of persistence in returns requires a highly disciplined due diligence process in fund selection. ...

  • bfinance

    ESG Under Scrutiny: Lessons from Manager Selection (bfinance, 2016)

    A deep dive into two recent manager searches – a Private Debt mandate for the UK Environment Agency Pension Fund and a Public Equity allocation for a European family office – reveals practical challenges and lessons for sustainability integration. How easy is it to distinguish between sophisticated marketing and real substance? Whilst the universe of ESG products continues to ...

  • 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. It discusses how asset owners should manage capacity by using their flexibility to choose where and how they invest, in accordance with what best fits their size. One implication is that optimal scale ...

  • In-house Investment Management: Making and Implementing the Decision

    This study examines in-house investment management by asset owners. It specifically focuses on the opinions and approaches of Australian superannuation (pension) funds, drawing on interviews with industry executives. ​A framework is proposed to assist asset owners to make and implement decisions to manage assets in-house, based on ...

  • Columbia Threadneedle Investments

    Not All Active Managers Are Created Equal - What To Look For And Why (2015)

    The notion that active fund management acts as a negative-sum game is challenged in this paper. One potentially significant uncorrelated source of investment return is the reward for the selection of exceptional managers. The authors look into numerous key factors that create sustained active investment performance, including conviction, contrarian thinking and concentration, ...

    • Professional
    • Views: 1161
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  • Commonfund Institute

    Chasing Hedge Fund Winners: The Appeal and the Risk

    For investors selecting managers to hire, the draw of managers that have produced outsized recent winners can be powerful. While such a strategy can work in the long-term, this strategy is implicitly based on the manager’s ability to track market movements across investment environments.  Download our whitepaper for an in-depth look at this investment strategy.