Overview: Best 10 Top Asset Management Firms
Investing on your own, or even with a professional investor, is not always the most effective way to grow and diversify your portfolio.
Some of the best investment opportunities in the financial market today are only available through asset management firms.
But before selecting a top asset management firm, it pays to understand which firms are the most popular, what services they offer, and how they can provide you with investment opportunities that would be impossible to find on your own.
This article breaks down the best top ten asset management firms, and provides a basic understanding of how they invest your money.
What is an Asset Management Firm?
An asset management firm pools the resources of multiple investors in order to create a single fund.
This accumulated fund is subsequently invested in the financial market and managed by the firm, in accordance with the stated financial goals of the fund.
Different asset management firms offer different approaches to this style of investing, and different funds within the same firm can have significantly different goals and results.
Image Source: Best Asset Management Firms
Pension plans, hedge funds, mutual funds, equity, fixed income products, and special bonds are all common offerings of asset management firms.
Through these and other financial products, investors gain access to a far more diverse set of opportunities than they would be able to access on their own.
Another advantage to asset management firms is that individuals can participate with modest investments.
Returns from asset management firms are paid to investors in proportion to the size of the investment. Asset management firms generate revenue for themselves by levying service fees on their investors.
AdvisoryHQ’s List of the Top 10 Best Asset Management Firms
The list below is sorted alphabetically (click any of the names below to go directly to that asset management firm’s website):
- Allianz Asset Management (Germany)
- AXA (France)
- BlackRock (United States)
- Credit Suisse Asset Management (Switzerland)
- Fidelity Investments (United States)
- J.P. Morgan Asset Management (United States)
- PIMCO (United States)
- UBS Global Asset Management (Switzerland)
- State Street Global Advisors (United States)
- The Vanguard Group (United States)
High Level Comparison Table | Best Asset Management Firms
Total Assets Under Management (AUM) as of 2016-2017
|AXA||Securities, insurance||Yes||$756 billion|
|Blackrock (BLK)||Mutual funds, hedge funds||Yes||$5.4 trillion|
|Credit Suisse||Mutual funds||Yes||$367 billion|
|Fidelity Investments||Mutual funds||Yes||$2.1 trillion|
|J.P. Morgan||Mutual funds, institutional funds||Yes||$1.7 trillion|
|PIMCO||Mutual funds||Yes||$1.5 trillion|
|State Street Global Advisors||Institutional funds, mutual funds||Yes||$2.4 trillion|
|UBS||Mutual funds, equities, fixed income||Yes||$1.1 trillion|
|The Vanguard Group||Mutual funds||Yes||$4 trillion|
Table: Top 10 Best Asset Management Firms | Above list is sorted alphabetically
Key Selection Criteria When Reviewing a Best Asset Manager
Investors generally look at five factors when selecting a top asset management firm.
These factors include:
- Total Assets Under Management (AUM)
- Investment Research Teams
- Investment Philosophy & Specialties
- Fee Structures
Total Assets Under Management (AUM)
How much money is the company managing? AUM is one of the first things an investor wants to know when choosing a top asset management firm.
Asset management firms generally attract more capital when their strategies have a proven history of success. On the other hand, companies with very low AUM may reflect poor strategies, infrastructure or research.
This is not always the case, but AUM is an important indicator of how well the firm is managing its investors’ money.
Investment Research Teams
Investors often look for the best asset management firms that have their own in-house investment research teams.
This indicates a proactive approach towards reading the markets, innovating new products, and creating investments that add value and perform better than expected.
Asset management firms who lack investment research teams may have a tendency to follow trends, use general research to shape their products, and deliver mediocre results to clients.
Investment Philosophy & Specialties
These are two crucial factors in choosing a top asset management firm.
Different asset managers may have more conservative or experimental investment management philosophies. Investors want to be certain that a firm’s investment philosophy lines up with their own financial goals.
There are also asset management firms that specialize in certain markets, such as real estate or retail. Global firms, like those mentioned in this article, often have interests in a staggering array of markets and asset classes.
Investors who wish to enter specific markets will look to asset managers who have demonstrated success in those markets.
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In order to offer a service to investors, asset management firms need to generate their own revenue.
The structure of these fees is an important consideration for potential investors, who often look for a balance between reasonable fees and successful track-records.
Since investors will ultimately be dealing with people at the firm, the quality of customer service being provided is an important factor.
Despite the collaborative and often modest nature of the investments involved, clients want to know that their money matters.
Working with an asset management firm is a long-term relationship, and investors prefer to work with investment management teams they feel good about.
Description of Products and Companies | Best Asset Management Firms
Currently the largest asset management firm in the world, Blackrock offers an array of public and private investments on all levels.
Their investment management clients include individuals, corporations, and institutions worldwide.
UBS is a Swiss asset management firm that ranks among the world’s largest managers of private assets. UBS is popular with high-profile investors, and financial products often require larger investments.
Based in Germany, Allianz specializes in insurance, real estate, equities and bonds. The firm also offers fixed-income products and mutual funds to individual investors.
The Vanguard Group
This American investment management firm is among the largest providers of Exchange-Traded Funds (ETF).
The Vanguard Group offers a variety of investment options for individuals and business entities, and was the first to offer an index fund to individual investors.
The Vanguard Group is often credited with making mutual funds accessible to the general public.
State Street Global Advisors
State Street is a Boston-based financial services provider with a focus on creating investment opportunities for corporations, businesses and other institutions. State Street also offers a broad scope of financial products to individuals in the U.S., Asia, Europe and Australia.
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In addition to the largest bond mutual fund in the world, this California-based investment management firm offers a long list of financial products for global investors.
A few of PIMCO’s offerings include currencies, equities, and Exchange-Traded Funds.
Fidelity is an American corporation with a broad set of investment and wealth-management products, including a long list of mutual funds available to individual investors.
Based in Paris, AXA maintains a strong global resence. This asset management firm’s products for individual investors include mutual funds, retirement planning, index funds, and life insurance.
The asset management division of J.P. Morgan offers mutual funds, wealth management, structured products, and retirement planning to individuals. Businesses and corporations are also serviced by a comprehensive set of investment options.
This Swiss firm services individual investors with hedge funds, equities, commodities, private equity, and fixed income products.
Businesses and corporations also invest with Credit Suisse using a variety of products.
Conclusion: Finding the Best Asset Management Firms
Asset management firms are an excellent way for individual investors to diversify their portfolios and participate in new investment models.
With only a modest investment, people gain access to a world of opportunities and expertise that would normally be reserved for high-profile investors.
However, investors interested in partnering with one of the best asset management firms should be prepared to enter a long-term relationship—and stay with the firm through shifting market conditions—in order to maximize returns.
The best asset management firms do not promise dramatic results overnight, but the staggering amount of money being invested with these top ten firms is proof of their effectiveness in the long-run.
The top asset management firms in the world bring a history of success, solid infrastructure, and a vast array of financial products to the table.
It’s important to choose a firm that understands and shares your investment goals.
Doing your homework on a given firm before visiting their office will increase your chances of finding the best match, and developing a fruitful long-term relationship.
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