Date of Graduation
5-2021
Document Type
Thesis
Degree Name
Bachelor of Science in Business Administration
Degree Level
Undergraduate
Department
Finance
Advisor/Mentor
Riley, Timothy
Abstract
Unlike many other financial institutions and investment companies, GT seeks out and hires the best investment managers they can find instead of picking all the individual investments themselves. This fund-of-fund management approach is “an investment vehicle where a fund invests in a portfolio composed of shares of other funds rather than investing directly in stocks, bonds, and other securities” (Corporate Finance Institute). This approach allows GT’s clients to have access to the best in the business managers that they would not be able to source or buy into on their own. Many of the best managers have a higher buy-in price to the fund than the individual investor can afford. This is especially significant when considering the diversification of managers and funds. Putting an entire investment portfolio with one fund or manager increases risk and goes against traditional investment advice. Funds typically have a team of 2-3 managers responsible for it. The relationships GT has built over its tenure inform them of when these new funds are opening or doing another round of funding. The process of deciding which managers to invest with is extremely involved and costly. However, doing this enables outperformance and instills confidence in the quality of the investment.
Citation
Rook, A. (2021). The Advantages of Active Management Overtime Through Turbulent Markets. Finance Undergraduate Honors Theses Retrieved from https://scholarworks.uark.edu/finnuht/56
Included in
Business Administration, Management, and Operations Commons, Finance and Financial Management Commons