The Last Mutual Fund Manager Standing | How Eric Crittenden Defied the ETF Boom to Build a $1B Fund
Jan 7, 2025
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Eric Crittenden, CIO and founder of Stand Point Asset Management, shares insights on navigating the changing investment landscape. He discusses how his mutual fund achieved over $1 billion in assets under management in just five years amidst the prevalence of ETFs. Crittenden highlights the importance of an all-weather investment approach and diversification strategies for weathering market volatility. He emphasizes the value of global equity exposure and educating clients about alternative investments, challenging common biases in the industry.
Standpoint Asset Management has successfully raised over $1 billion in AUM by utilizing a unique all-weather investment strategy focused on diversification.
Despite the dominance of ETFs and alternative investments, mutual funds remain resilient, managing over $20 trillion in assets and attracting ongoing interest from new firms.
Effective relationship-building with financial advisors is crucial for Standpoint's growth, as it fosters trust and caters to client needs in a competitive landscape.
Deep dives
The Resurgence of Mutual Funds
Despite the surge of hedge funds and ETFs, the mutual fund industry remains robust, commanding over $20 trillion in assets under management (AUM). Noteworthy firms like AQR and PIMCO continue to attract significant AUM, while emerging players are exploring the mutual fund structure. This ongoing interest underscores the stability and potential of mutual funds amidst a market increasingly dominated by alternative investment vehicles. Smaller managers face unique challenges in accessing distribution channels, yet innovative strategies can still achieve substantial AUM growth.
Standpoint Asset Management's Unique Approach
Standpoint Asset Management employs a distinct investment philosophy called all-weather investing, focusing on diversification across various asset classes such as equities, bonds, and commodities. The firm combines traditional asset classes with alternative strategies to create a smoother investment journey for clients. This holistic approach allows Standpoint to provide a more attractive offering compared to typical trend-following funds, which often lack equity exposure. By blending different asset categories, Standpoint aims to help investors achieve consistent growth while mitigating market volatility.
Path to Success in AUM Growth
Since its launch in 2020, Standpoint Asset Management has surpassed $1 billion in AUM, a feat attributed to its differentiated investment model and effective relationship-building with financial advisors. Initially starting with a modest $4 million from a seed investor, the firm has expanded its base primarily through small to medium-sized financial advisors across the United States. The firm benefits from strong client relationships, allowing for targeted marketing and tailored investment solutions. This growth strategy highlights the importance of understanding client needs and developing personal connections in the financial advisory landscape.
Understanding Client Relationships and Retention
Standpoint Asset Management values the ability to identify and nurture relationships with its investors, with 75% to 85% of their clients easily mapped. This close connection enables the firm to maintain open communication and foster trust, which is critical in a competitive investment environment. Investors often seek alternative investments when traditional markets falter, and being proactive during these times can result in increased loyalty and retention. Through transparency and responsiveness, Standpoint strives to differentiate itself in the crowded mutual fund space.
Navigating Market Dynamics and Future Strategies
The current market trends reflect a complex landscape where anticipated downturns may lead clients to seek diversification more than ever. Standpoint Asset Management emphasizes the necessity of having a portfolio that combines various asset classes to mitigate risk effectively. As the firm engages with advisors and investors, it remains made aware of the psychological and social challenges associated with investing in alternatives during high market volatility. By maintaining a systematic investment strategy, Standpoint aims to position itself favorably as clients navigate uncertain market conditions.
When was the last time you heard about an exciting new mutual fund launch? It’s probably been a while. Despite ETFs, hedge funds, and burgeoning asset classes like private credit taking all the headlines, mutual funds still control over $20 trillion in AUM. So, how does one raise assets in the 2020s with a product many associate with a time gone by? Eric Crittenden, CIO and Founder of Stand Point Asset Management, joins OPM to share how his mutual fund has done just that and reached over $1 billion in AUM in less than 5 years.
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