Boston, MA (May 1, 2018) – Cambridge Associates, a global investment firm that serves endowments, foundations, pensions, private clients and other institutional investors, recently co-hosted a forum featuring leading institutional investors’ and managers’ perspectives on diversity in the industry and insights on uncovering opportunities in the public and private markets.
The event, which convened nearly 100 senior investment professionals in the Boston area, was co-hosted by the Association of Asian American Investment Managers (AAAIM) and in partnership with the Chartered Alternative Investment Analyst Association (CAIA). It took place at Cambridge Associates’ Boston headquarters.
“We are always looking for best-in-class managers across asset classes, and believe that strong investment performance can come from many places, including ethnic and gender diversity as well as diversity of backgrounds and experiences. The convening of so many senior investment professionals allowed us to share new ideas, identify new opportunities, and be part of a conversation that’s critical to our industry,” said Sona Menon, Head of North American Pensions and an outsourced chief investment officer at Cambridge Associates.
The agenda included a panel discussion on the investment management opportunities with minority and women-owned enterprises (MWBE) and an in-depth conversation on the value of public markets versus private markets.
Among the points made:
- Persistence is key. Starting a private equity or venture capital firm isn’t easy, but fortitude, a long-term view, strong networks and a focus on operations can help move things along. While investment professionals should be prepared for some false starts out of the blocks and a longer than expected time horizon to raise a first pool of institutional investment capital, things will suddenly accelerate and quickly come to fruition.
- Diversity is important. Not only does it add value to communities, but it can also add value to a portfolio. Institutional investors may need to apply some creativity and flexibility to identify promising minority- and women-run funds – like broadening size parameters and leveraging personal and professional networks, but this effort will pay off in the end. This segment of the market is only going to get stronger and continue to grow.
- Opportunities for outperformance remain. Despite high valuations and strong public markets, there are ways for institutional investors to find pockets of stand-out opportunities. Investors should look to more niche areas like lower-midmarket growth equity, sector-focused funds, and strategies targeting family-owned enterprises and inefficiently run companies. That said, it’s important to remember that manager selection and due diligence are crucial parts of the investment process.
- There is power in private investments. Despite buoyant public equity markets, there remains real opportunity in private markets, and private investments can deliver consistent and differentiated returns over the long term. Said Liqian Ma, Managing Director at Cambridge Associates, “Our research shows that over the long term, on average institutional portfolios with more than 15% allocated to private investments like private equity and venture capital outperform their peers that had lower allocations to private investments.”
“Our first-ever Boston event was a huge success with powerhouse panels, interesting insights and noteworthy networking,” said Grace Reyes, President of AAAIM. “We’re sure the connections made and information exchanged will have a lasting impact on our membership and local attendees from the institutional investment community in the area. We are grateful for the partnership of Cambridge Associates.”
Panels and speakers at the event included Brenda Chia, Founding Board Member and Co-Chair of AAAIM and Venture Partner at Paladin Capital Group; Sanjiv Shah, AAAIM Board Co-Chair and Managing Director at HarbourVest Horizon; Juan Martinez, Chief Financial Officer at the Knight Foundation; Vikrant Raina, Managing Partner at BV Investment Partners; Deepak Sindwani, Co-Founder and Managing Partner at Wavecrest Growth Partners; Mary Tolan, Founder and Co-Managing Partner at Chicago Pacific Founders; Shannon Zoller, Founder of Tephra Advisors; York Lo, Senior Investment Analyst at John Hancock Investments; Liqian Ma, Managing Director at Cambridge Associates; Alison Svizzero, Director of Investments at Children’s Hospital Boston; and Ted Yun, Managing Partner at NexPhase Capital.
Cambridge Associates is committed to finding the best-in-class women- and minority-led managers for the benefit of clients’ investment portfolios. The firm currently tracks over 300 minority- and women-owned investment managers and over 750 minority- and women-owned investment strategies, ranging from well-established managers with multiple products to newer funds with relatively smaller assets under management.
About Cambridge Associates
Cambridge Associates is a leading global investment firm. We aim to help endowments & foundations, pension plans, and private clients implement and manage custom investment portfolios that generate outperformance so they can maximize their impact on the world. Working alongside its early clients, among them leading university endowments, the firm pioneered the strategy of high-equity orientation and broad diversification, which since the 1980s has been a primary driver of performance for institutional investors. Cambridge Associates delivers a range of portfolio management services, including outsourced CIO, non-discretionary portfolio management, staff extension, and asset class mandates.
Cambridge Associates maintains offices in Boston; Arlington, VA; Beijing; Dallas; London; Menlo Park, CA; New York; San Francisco; Singapore; Sydney; and Toronto. Cambridge Associates consists of five global investment consulting affiliates that are all under common ownership and control. For more information, please visit www.cambridgeassociates.com.
About the Association of Asian American Investment Managers (AAAIM)
AAAIM was founded in 2006 to serve as a platform for Asian American investment managers to meet and conduct business with plan sponsors, fund-of-funds and institutional investors. AAAIM encourages institutional investors to diversify their pool of fund managers by introducing them to high-performing, qualified Asian American fund managers across all major asset classes such as hedge funds, fixed income, private equity, real estate, and venture. AAAIM encourages and fosters business ties among Asian-led and managed firms, and takes a deep interest in mentoring Asian American students who intend to create a career in finance. For more info, please go to http://www.aaaim.org.