Pimco Tops Among Institutions, Cogent Says

February 09, 2011

Pimco and Loomis Sayles top new survey of institutional investors’ preferences.

Pimco, the world’s largest bond fund manager, and Boston-based asset manager Loomis Sayles are the most popular asset managers among institutional investors, a study by Cogent Research showed.

In its first-ever Institutional Investor Brandscape Report, the Cambridge, Mass.-based research firm found that Pimco and Loomis Sayles topped a list of 23 asset managers in attributes such as investment performance, investment philosophy and investment team to become the brands institutional investors feel most loyal to.

Pimco is the much bigger of the two, with more than $1 trillion of assets under management in some 10 countries. By contrast, the 84-year-old Loomis Sayles had some $151 billion of assets under management as of Dec. 31, 57 percent of which represented institutional clients, according to the companies’ websites.

“As we come off a period where fixed income captured a proportionally larger share of institutional assets, Pimco and Loomis Sayles stood out as best in class in capturing the loyalty of their clients,” Christy White, principal at Cogent, said in a press release. “They’re very different firms but both were apparently successful in satisfying clients’ needs.”

Vanguard Makes Top Three

Vanguard, which outperforms all other asset managers regarding fees, ranked third in terms of brand loyalty among institutional names, the report stated.

The company already leads the pack of ETF providers when it comes to advisor loyalty, and is quickly chipping away at iShares’ brand name to become one of the most recognizable ETF providers.

The company, in fact, attracted more new money to its ETFs than any other provider in 2010—some $40.5 billion in inflows, outranking the world’s largest ETF purveyor, BlackRock’s iShares, for the first time ever.

Vanguard’s growing reputation among institutional investors is also in line with Cogent’s recent findings in the 401(k) market, which revealed Vanguard was one of the top names among plan sponsors in attracting brand loyalty, the release added.

“Vanguard’s success in moving its brand upstream into the institutional market is yet another sign of changing times where a high-quality but low-cost value proposition can generate strong brand momentum,” White said.

BlackRock In The Middle

New-York-based BlackRock, the parent company of the world’s largest ETF provider, iShares, ranked 12th among the 23 asset managers included in the survey.

“It was surprising to see that BlackRock only performs well with about half of their customers,” White said in an interview. “They came in right down the middle, with only one out of every two clients saying they were satisfied with the company.”

Among the 10 metrics included, managers were rated on organizational stability, portfolio management and risk practices, fees, research, service and support and relationship management. BlackRock “hovered on the 50 percent mark” in just about all of them, with portfolio management and risk practices being their strongest numbers, while fees were their weakest mark, White said.

“Here’s an example of a brand that isn’t performing as well as expected given the perception of that brand in the marketplace,” White said. “

Other Players

The survey, which sampled 590 institutional investors with more than $20 million in investable assets, also found State Street Global Advisors led its competitors in terms of relationship management. The company ranked fifth overall regarding brand loyalty among institutional investors.

 

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