Download This PaperChoosing Investment Managers
67 Pages Posted: 16 Sep 2020 Last revised: 22 Feb 2022
Date Written: February 14, 2022
Abstract
We study how plan sponsors choose investment management firms from their opportunity set when delegating $1.6 trillion in assets between 2002 and 2017. Choice is related to (i) pre-hiring returns, and (ii) pre-existing connections between personnel at the plan (or investment consultant), and the investment management firm. Ex post, connections do not result in higher post-hiring returns. Relationships are thus conducive to asset gathering by investment managers but do not generate commensurate pecuniary benefits for plan sponsors.
JEL Classification: G10, G11, G20, G23, H55, H75, J32, D91
Suggested Citation: Suggested Citation
Swiss Finance Institute ( email )
c/o University of Geneva
40, Bd du Pont-d'Arve
CH-1211 Geneva 4
Switzerland