A while ago, fellow contributor Chris Georges wrote an article about whether investors would be better off investing in a managed fund (which picks good stocks on behalf of investors), or the fund manager itself (which makes a profit from operating the fund/s).
Overwhelmingly the stats suggested that buying the fund manager itself could be a better choice, especially if the funds it operates have a strong track record. With that in mind, here are 3 fund managers that I think could be worth adding to your watch-list today:
Platinum Asset Management Limited (ASX: PTM)
Founder and CEO Kerr Nielson has a long record of generating quality returns for investors in Platinum's funds – he was also the Chief Investment Officer until 2013. Although Platinum has seen net outflows in recent times, which have hurt profitability, the company's funds continue to perform well and management is optimistic that better days are ahead. Platinum pays an attractive 6% dividend.
Challenger Ltd (ASX: CGF)
Challenger is an annuity provider and fund manager that makes money from a range of products that are designed to provide financial security in retirement. With an enormous sum of superannuation money expected to move into the retirement phase soon, the industry is expecting to be managing a significantly larger group of assets in 5 and 10 years time. As one of the leading players, Challenger is in a key position to benefit.
BT Investment Management Ltd (ASX: BTT)
BT Investment is a UK/Australian fund manager with a track record of growing funds under management (FUM) – it now manages $84 billion, up from $78 billion at the end of 2015. BT also offers superannuation, private wealth management, and insurance, and has a track record of growing profits and dividends. Further acquisitions may also be on the cards in the future, since the expansion into the UK has so far proven successful.
