TY - JOUR T1 - Fund Hiring Rules and Investment Firms JF - The Journal of Investing SP - 7 LP - 16 DO - 10.3905/joi.2015.24.3.007 VL - 24 IS - 3 AU - Robert Snigaroff AU - Jungho Baek Y1 - 2015/08/31 UR - https://pm-research.com/content/24/3/7.abstract N2 - Investment manager firm concentration for traditional equity and fixed income strategies has grown as a result of the increase in large funds’ share of overall pension funds and is now increasing in hedge fund and private equity strategies. Funds’ practice of buying from the same few large providers at increasing rates runs contrary to their competition to produce alpha, as research demonstrates that smaller firms add more value. From the firm’s perspective, continuing to remain a small institutional investment management firm is a riskier business strategy. Small firms rationally desire growth, including additional products and mergers, to achieve the scale buyers require, contrary to specialized boutique business models.TOPICS: Real assets/alternative investments/private equity, manager selection ER -