"Emerging Managers Have Delivered Twice the Returns of Established Managers"

Fascinating:

Large funds, as proxied by the Top 100 Funds by AUM, underperform Emerging Managers by 200 – 400bp p.a. Despite these findings, by myself and others, The latest asset flows data from HFR indicates that only the larger funds are attracting new AUM.
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Based on the historic data it seems that Institutional investors are prepared to forgo returns that are at least 20 – 40% higher (100 – 200bp p.a.) from Emerging Managers in exchange for the assumed peace of mind and reduced business risk that larger funds provide.