Asset Managers: How To Build Your Story

Asset Managers: How To Build Your Story

Complying with fiduciary responsibility requires enhanced analysis

According to Pensions and Investments, 94% of institutional investors use consultants. Investment committees for foundations or pensions are charged with fiduciary duty to beneficiaries. Using consultants is not a substitute for complying with fiduciary responsibility. Instead, eVestment recommends the following actions:

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  1. Utilize consultants as resource for manager searches: Saves time in screening managers.
  2. Conduct internal search and analysis: Provides a check on consultant’s results, may uncover red flags on managers proposed by consultant or new managers to consider.
  3. Compare approach against investors’ peers: This step may bring up new information on managers being considered and peers may provide references.


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The three steps outlined above comprise a thorough process that emphasizes value that investment committee provides. This in turn helps solidify trust.

Asset managers need to distinguish their approach from competitors

Institutional investors and consultants are conducting enhanced due diligence to comply with fiduciary duty for beneficiaries. Evestment highlights that competition is mounting. CaseyQuirk and eVestment estimate that net new funds will slow and that more mandates will come from switching managers. This difficult environment urges asset managers to use differentiation to grow assets under management (AUM).

Asset managers

Three crucial steps to expand AUM (Source:

Build story and position portfolios against peers

The first step in executing differentiation is crafting a story behind results. Asset managers should address:

  1. Pedigree – quality of people, firm history
  2. Philosophy – firm’s vision and mission
  3. Process – how investments are chosen, buy and sell discipline and risk management
  4. Portfolio – holdings, style, composition
  5. Performance – results relative to competition

Institutional and ultra high net worth investors seek managers that stay within their stated style and that can generate returns consistently. As an asset manager, it is crucial to demonstrate how the story works. Showing details of some closed positions, including purchase date and rationale for holding period is powerful. Examples help investors grasp execution and determine whether it was effective.

Target distribution efforts

Asset managers need to determine who the target audience is for their portfolios. If they choose to work with institutional investors, they need to participate in databases. Evestment, a third party database, offers exposure to institutional investors and consultants. Because databases have different information requirements, eVestment recommends asset managers to populate commonly used fields for screening. Goal is to help investors or consultants find the asset manager they need to meet their goals. Marketing materials that showcase the asset manager’s story need to accompany database statistics.

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