PFM Asset Management graduates Geneva Capital Management from Emerging/Minority Manager Program
PFM Asset Management LLC (PFM) has graduated Geneva Capital Management from PFM’s Emerging/Minority Manager Program. Geneva, an employee-owned investment firm that PFM hired in 2007, has been engaged for a larger mandate as part of PFM’s public fund client’s pension fund.
"We are delighted at Geneva’s advancement to become one of the managers of our clients’ general mandates," says Michael Harris (pictured), a PFM Managing Director and leader of the Emerging/Minority Managers Program. "By identifying and hiring Geneva Capital 3-1/2 years ago to manage an USD8 million mid-cap growth mandate, we have given them the visibility they needed to grow their business. This resulted in improved performance for our client and an enhanced opportunity for a deserving small firm."
PFM began identifying emerging and minority-owned firms some ten years ago in response to public clients’ desires to diversify investment management and meet social responsibility goals while also improving performance. Emerging managers are typically defined as firms with less than USD3 billion under management. They usually lack the exposure of mainstream firms and face other hurdles in establishing a relationship with major institutional clients. As a manager-of-managers, PFM identifies new emerging manager candidates, performs extensive due diligence, hires them on behalf of the client, and then monitors their performance and growth.
"We put a great deal of our substantial resources into initial manager screening and selection as well as ongoing compliance monitoring and oversight on behalf of our clients," says Harris. "PFM assumes this responsibility and continuously evaluates emerging and minority-owned investment firms on qualitative and quantitative standards such as portfolio data, staff qualifications, and regulatory compliance. Ultimately, our Emerging/Minority Manager Program introduces institutional investors to a pool of untapped investment management talent, as demonstrated in Geneva Capital’s case."
From October 2007 through December 2010, Geneva Capital Management exceeded the Russell Mid-Cap Growth benchmark. This strong performance led to Geneva’s selection to manage approximately USD50 million as part of a larger mandate for a PFM client.
This is the second graduation in the past three years for PFM’s Emerging/Minority Manager Program; PENN Capital Management graduated in 2008. PFM’s Emerging Manager Program Composite continues to consistently top the performance of the 80:20 Russell 3000/Barclays Capital Aggregate customised benchmark. Since its inception in August 2000, the PFM Emerging Manager Program Composite outperformed the benchmark on an annualised basis as of March 31, 2011, net of fees. In fact, PFM’s Emerging Manager Program Composite has surpassed the benchmark every calendar year since the program’s inception over ten years ago.
"The Emerging Manager Program is an important undertaking for PFM," says Harris. "It is a win-win for all concerned, as talented small firms get to gain the experience and opportunity to grow while PFM’s clients are able to manage risk through diversification and maintain focus on their goals to enhance investment portfolio performance."