A confluence of several issues—poor relative active investment performance, the growth and acceptance of low-cost index-based products, and the expanding power of the retail-advised channel—has made it increasingly difficult for the US-based traditional asset managers to generate organic assets under management growth, leaving them more dependent on market gains to increase their assets under management. While we believe there will always be room for active management, the advantage when it comes to getting and maintaining placement on distribution platforms will probably go to asset managers that have greater scale, established brands, solid long-term performance, and reasonable fees—with Affiliated Managers Group falling short in most of these categories.
