2013 Might Be the Year of the Asset Manager But Not For Everyone
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Thursday, January 3, 2013

2013 Might Be the Year of the Asset Manager But Not For Everyone

2013 may herald the great comeback of the asset manager, led by Affiliated Managers Group [profile] and T. Rowe Price [profile]. So predicts Sandler O'Neill analyst Michael Kim.

In a note yesterday, reported on by Teresa Rivas in the Barron's "Focus on Funds" column, Kim argues that flows will turn around after three years "in the wilderness (from an organic growth perspective)." Indeed, Kim expects investors' risk appetite to grow, thus favoring the equity strategies that are still the mainstay of most mutual fund shops and other asset managers.

Which publicly-traded asset managers will benefit the most from this comeback? Kim lauds AMG and T. Rowe in particular. He also likes AllianceBernstein [profile], Franklin Templeton [profile], Invesco [profile] and Virtus [profile]. He also favors private equity shops like Blackstone (which is entering the mutual fund business), KKR (which launched its first mutual funds this year) and Oaktree (which backs the mutual fund stars at DoubleLine).

On the flip side, Kim warns against mutual fund shops with "muted" flows over the horizon. He lists Artio [profile], Eaton Vance [profile], Federated [profile] and Janus [profile] in this camp.

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