QMA to Expand into London
Prudential’s quant shop plans to deploy boots on the ground in London as part of a wider project to grow its non-U.S. market share.
Quantitative Management Associates — PGIM’s quantitative investing boutique — intends to open a London office in the first quarter of 2018, QMA CEO Andrew Dyson told II in an interview.
The U.K. outpost would be QMA’s first outside of the United States, and part of a larger plan to reach international clients. As of last month, less than five percent of the brand’s $130 billion in assets under management were from non-U.S. clients., according to Dyson.
QMA has 195 staff members based in Newark, New Jersey — where parent company Prudential Financial is headquartered — and a further 10 in San Francisco. London staffers would be QMA’s first Europe-based employees.
Dyson, who took the CEO chair in October following the departure of Scott Hayward, said local knowledge will be key to winning business outside of North America. “I envisage having a QMA office with QMA people in London for the first quarter of next year,” he said. “It is highly likely that we will end up with somebody that can work with all of the PGIM network around the world.”
[II Deep Dive: With Quants in Demand, QMA Goes Global]
Dyson has drawn up a growth plan initially focused on leveraging its PGIM ties and developing a suite of products that appeal to non-U.S. investors. Last month, QMA hired Goldman Sachs and Och-Ziff Capital Management alumnus Adam Broder as head of global distribution.
On the expansion into Europe, Dyson said the firm appreciates the differences in legislative frameworks, currencies, and preferences of the local market. For example, pointed out that environmental, social, and governance-oriented investing is more broadly appreciated in Europe than in the U.S.
“There is a whole suite of adaptations,” he said of moving into a new market.
Dyson was previously head of BlackRock’s global institutional business and worked for investment consultancy Mercer before that.
PGIM — the asset management arm of Prudential Financial — is a growing presence in Europe since launching in the U.K. in 2015. In September, Bloomberg reported that the company was considering entering the exchange-traded fund market.
With PGIM established in Europe, Dyson plans to use its distribution reach to bolster sales of QMA strategies. “We are trying to have the best of both worlds,” the CEO said. “A business like ours is a specialist in a particular discipline, but able to compete on a level playing field — using the scale of our parent — with the BlackRocks and the Vanguards.”