Why investing in emerging managers makes sense?
Updated: Mar 30, 2022
While we cannot deny there might be some bigger rate of inexperienced managers among the emerging managers, there are some big pros that really attract the investors
First and most important, emerging managers have better average return due to their more endeavor, healthier attitude and more updated knowledge. This is well known phenomenon supported by researches.
Attitude drives everything. Believe or not, emerging managers usually have stronger sense of responsibilities, which is critical for many cases in this industry. Established managers tend to keep things normal and polished to avoid more pressure and reluctant to take more challenge. While emerging managers are more likely to see more progress made every day. We are not trying to criticize anyone, but this is the nature of human beings. Every career has its hay day in term of efficiency, and hedge fund managers’ sweet spot mostly exists in the emerging stage.
Off cause, emerging managers have more up sides such as they are usually more energetic and easier to work with…
These several phenomena are the most important aspects for us as well as for the investors. As said in previous posts, investor always take it first of being able to have better return when they consider using emerging managers. So what we are trying to do in EHFA is to strengthen this point by constantly screening and promoting the best strategies and managers that meet the request of higher return and better risk control to serve our valued clients. Off cause we will try best not to miss any special strategies that have other catches to meet some special clients’ needs. This requires detailed categorization start from every member’s initial registration. E.g. some strategies may have mediocre return, but perform quite well in defending the volatilities may also be popular for some organizational investors.
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