Why an Activist Hedge Fund Cares Whether Apple’s Devices Are Bad for Kids

Harvard Business

On January 6, 2017, JANA Partners , a New York–based activist hedge fund, and the California State Teachers’ Retirement System (CalSTRS) sent a letter to Apple’s board of directors that may change the future of activist investing. The term “activist hedge fund” connotes to many a “corporate raider” who creates short-term profits at the expense of other stakeholders and long-term investors. Tim Ellis/Getty Images.

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One Big Reason There’s So Little Competition Among U.S. Banks

Harvard Business

Basically, a handful of asset management firms have become the most powerful shareholders of the nation’s largest banks. This collective flood of individual investment has turned asset management companies into ginormous shareholders. BlackRock alone manages about $4.7 trillion in assets. Indeed, the asset management firms engage with hundreds of companies each year to discuss matters of strategic importance, including product market strategies.

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Research: Index Funds Are Fueling Out-of-Whack CEO Pay Packages

Harvard Business

The pay of top managers has risen faster than those of other star earners. Top management compensation packages guarantee a high level of pay, but are often only weakly linked to the performance of the firm relative to its industry competitors. Nowadays, the same handful of large, diversified asset management companies controls a significant proportion of US corporations. In other words, these managers are rewarded less for outperforming their competitors.

Japan Is Counting on Shareholder Activism to Improve Its Economy

Harvard Business

CEOs live in fear of activist hedge funds, and politicians worry about their effects on workers. In Japan several factors combine to help insulate managers from outside influence, including cross-holdings where the company owns shares in a partner firm, docile boards mostly composed of company executives, and a court system historically biased against investment funds. Rather than berating management publicly, these funds have led quiet discussions behind closed doors.

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Startups Could Fundamentally Change the Way Big Investors Operate

Harvard Business

The success of institutional-investment firms is socioeconomically vital: Their task is to grow the financial assets needed to fund retirements, development, education, scientific research, and many other capabilities associated with pensions, endowments, foundations, sovereign wealth funds, and the like. In September 2016 we undertook a survey of nearly 300 endowment and foundation managers. Innovation has the potential to transform the investment industry.

Why the U.S. Needs More Worker-Owned Companies

Harvard Business

The social impact funds want to support it for social reasons, whereas hedge funds and others are recognizing that the superior resiliency and performance of worker-owned firms can improve their returns. On their own merits, worker-owned businesses can show policy makers, investors, managers, and advisers that companies with democratic ownership values and structures are operated with the same profit motivation as other companies. Klaus Meinhardt/Getty Images.

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Morning Advantage: Going Way Out on a Limb for Profits

Harvard Business Review

Contrarian Number 1 is George Elliott, founder of a hedge fund (Naftilia Asset Management) that plans to buy nothing but stocks from – wait for it – Greece. Ulukaya, who already managed a small cheese company, had been mulling over the lack of good yogurt in the U.S., As befits a Monday, we’re into contrarians this morning. Whatever it is, they’re against it, and we find that attitude bracing.

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CEOs Can Attract Long-Term Investors

Harvard Business Review

But three years after the financial crisis broke, I remain more convinced than ever that the fundamental cure for restoring economic growth and repairing societal trust in business is to deepen our ability to manage companies for the long term. In scores of conversations I've had with business leaders, pension fund trustees, asset managers, employer associations, and NGOs since I first issued this call in HBR , everyone has agreed with the goal.

Universities Are Missing Out on an Explosive Growth Sector: Their Own

Harvard Business Review

One outside manager of many endowments I spoke to confirmed to me that there has been “no mandate” from clients to be investing in the future of higher education. “I Those who manage money for higher education, I propose, need to get much more interested in the market they are in. Many universities manage billions in research funding, but there is usually no R&D budget for their own product, namely delivering education to willing buyers.

Stop Assuming Your Data Will Bring You Riches

Harvard Business Review

Hedge Funds will love our data — they will practically buy any set of data that might give them a potential edge”. For example, a product evaluating nonprofit organizations may be highly useful to a wealth manager seeking to help his client to select a charity as part of a value-added tax efficiency service. Execution Knowledge management “We have a treasure trove of data, it’s highly valuable”. “If

Why Those Guys Won the Economics Nobels

Harvard Business Review

The prizes were awarded “for their empirical analysis of asset prices,” but what the three had been doing looked from the outside less like a common endeavor than a not-all-that-coherent argument. Others, most notably money managers and former Fama students Cliff Asness and John Liew in an epic Institutional Investor article , have done a lot recent to clarify how Fama’s ideas and Shiller’s can at least co-exist peacefully. Economy Finance Managing uncertainty