Money Manager Review Combines Analysis and Judgment
The evaluation of money managers selected for the implementation of an investment management strategy combines statistical, quantitative analysis and subjective, qualitative judgment. A black box “historical” method for the evaluation of asset managers, ultimately gives way to an evaluation of the ability for asset managers to repeat past performances based on certain institutional characteristics:
- Ownership;
- Size of Firm;
- Manager Experience;
- Assets under Management;
- Change in Personnel;
- Trading Capability; and
- Research.
The best and brightest minds need a place to apply the learned craft of money management. Does your asset manager invest his/her own monies in the fund, and has managed the fund for more than 10 years, have best execution for the trades, and does their own research? There has to be some standard used to select asset managers who will outperform the appropriate benchmark and peer group going forward. You will not find your True North unless there is investment guidance based on a rigorous investment process.
