Independent Boutique Active Managers Are Best Positioned to Navigate Market Volatility

AMG Announces Release of New Study: The Independent Boutique Advantage in Volatile Environments

• Independent boutique active managers outperformed both non-boutique active managers and passive indexing over the past 20 years, delivering the highest excess returns during periods of elevated volatility
  
  
• Independent boutiques outperformed passive indexing in 11 of 11 product categories and non-boutiques in 10 of 11
  
  
• Boutiques produce an average 241 bps of excess returns relative to passive indexing during highly volatile periods
  
  
• Greatest outperformance by boutiques in Global Equities, Emerging Market Equities, and Small Cap Equities

WEST PALM BEACH, Fla., April 17, 2020 (GLOBE NEWSWIRE) -- As investors grapple with challenging decisions in the face of uncertainty, record market volatility has created a favorable environment for independent active boutique managers to generate alpha. Defined by their investment independence, operational autonomy, entrepreneurial cultures, and specialized investment processes, independent boutiques outperformed both passive indexing and non-boutique active managers in periods of elevated volatility over the past 20 years, according to a new study released by global asset management company Affiliated Managers Group, Inc. (NYSE: AMG). Building on the results of AMG’s original study, “The Boutique Premium” (initially published in 2015 and updated in 2018), which concluded that boutique firms outperformed indices and non-boutiques, “The Independent Boutique Advantage in Volatile Environments” empirically demonstrates that alpha-oriented boutique investment firms delivered the highest excess returns over passive indexing and non-boutiques in periods of elevated volatility.

“The unprecedented volatility in the market today is prompting investors to consider whether they can afford to take a passive approach to managing their portfolios,” said Jay C. Horgen, President and CEO. “We believe that active management plays an important role in client portfolios at all times, but now more than ever. Two decades of data strongly indicate that now is the time for investors to turn to independent active boutique managers – independent boutiques generate the highest excess returns, relative to both passive indexing and larger active managers, in periods of elevated volatility. The contrast between active boutiques and passive indexing in periods of volatility could not be more stark, with independent boutiques outperforming indices in every investment style studied, by an average of 241 basis points.”