The investment industry is realising that asset managers do not necessarily get better when they get bigger. This is especially true for active managers; bigger can mean mediocre. The rise of boutique managers in South Africa suggests that some investors believe that boutique firms are a better bet.
This is evident through the numbers: the number of boutique managers in South Africa has risen from 8% of the investment managers’ universe in 1999, to about 38% of the universe currently, according to industry body Asisa.
However it’s easy to make money when markets are rising and confidence is high. But when markets slow or another crisis unfolds, investors move their funds from boutiques back to the perceived safety of the big institutional managers.
The questions – why would investors pick a boutique asset manager? Are investors getting better returns with boutiques? Are their investments safe? And are they getting value for money?
In a Moneyweb webinar on Wednesday Hlelo Giyose, CIO of First Avenue Investment managers and Willem de Vos, director Autus Fund Managers discuss these issues with Moneyweb’s Hanna Barry and Sasha Planting.