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Where is institutional value investing in London?


tol1
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After a trip to the Eastcoast I headed back to London and wondered why the City lacks institutional value investment firms. There are the Oldfields and Bauposts (with a small office), but I just cannot help wondering why so few firms run a value investing strategy out of London. I am not referring to mom and pop shops and one-man bands who manage their retirement.

 

Why are there so few fundamental equities investment firms in London? Maybe I missed a few names, so please chip in.

 

 

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It has a lot to do with the customers and the consultants.  Even the value shops in London mostly have US clients on the institutional side.

 

Institutions in the UK have historically been very consultant driven and the consultant community outside the US is much less style focused. Say what you will about style boxes, but the do create a natural bid for “value”

 

Exacerbated of late by the trend to de-risk away from equities.

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Not sure about the Consultant piece in Europe frankly. Fund founders I know do the marketing with an internal guy or start off by themselves. Interestingly, there is a few shops in Spain; the value investing culture is nurturing over there.

 

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Lol. Consultant penetration of the institutional channel in the UK is nearly 100%..  most of the big value shops in the US similarly began as one man bands.

 

The Spanish guys (who all came out of Bestinver) are retail only and given Parames performance if he were in a market with a natural bid he'd be managing 100 bn.

 

There is also a component in the US asset management industry professionalizing probably a decade or more before the UK.  Read Capital Ideas for that history.

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