Why set up a fund boutique in this environment?

Strengths versus global fund houses

Amul Pandya, CFA and director at Cape Wrath Capital, discusses the benefits of setting up a boutique fund management firm despite an environment of increasing regulation and cost pressures.

Howard Marks recently remarked that at the start of his career, people didn't go into investment management to "make lots of money".  His words can help us distil much of the ire facing the active management industry today into one conflict. What is good for the management company (higher revenues) is often incompatible with what benefits the client (investment performance).  Is differentiation the key to success for boutique asset managers? A cynic could attribute the industry's troubled reputation to businesses seeking to launch multiple funds, growing them beyond their capacity,...