Our Emerging Managers
Why do emerging managers start their own companies — especially when many founders of emerging firms already have a successful track record investing for Wall Street companies or large pension plans? In founding their own companies, sometimes these men and women are running toward something, seeking to fill a void, realize a dream or act decisively to make a new idea come to life.
Sometimes, too, they are running away from something, moving beyond a mindset where short-term business pressures compromise long-term performance, where the clients’ best interests are sacrificed on the altar of the bottom line, or where they cannot succeed due to factors completely unrelated to talent or hard work. Moreover, the "alpha drivers" — investment discipline and investment culture — are often lost as mainstream firms become principally focused on gathering assets.
The 59 investment firms in Progress’ current lineup of funded managers (representing 88 strategies) range from a company headed by a veteran with 30 years of experience running the research department for a major Wall Street brokerage firm to a company founded by a former chief investment officer for a large public pension plan. These entrepreneurial companies often seek to exploit some new competitive edge as described below.
Sources of Competitive Advantage
- Tighter integration of top-down and bottom-up research, resulting in portfolios that carefully balance best-in-class innovators with household names
- New tools to exploit timeless sources of information — for example, new modeling techniques in the field of behavioral finance
- Quantitative modeling that allows portfolio managers to view a stock simultaneously from diverse perspectives, facilitating return enhancement through stock selection and risk control through portfolio construction
- Strategies that capitalize on fixed income perspectives to identify undervalued equities
- Companies that have achieved an exceptionally disciplined blend of quantitative analysis and fundamental research, capturing the best of both disciplines
- An investment approach based on insights derived from the world of investment banking
- Small-cap strategies designed to exploit a lack of sell-side coverage and an over-reliance on databases
The Progress manager selection process places a premium on experience combined with innovation. We are always looking for managers who offer a clearly defined competitive advantage.