The II 300

Ranking Overview Methodology

When Federal Reserve chairman Ben Bernanke this spring announced that he might begin tapering the Fed’s $85 billion-a-month bond buying program as early as September, investors sold off bonds and the yield on the ten-year Treasury note rose to as high as 2.6 percent. As expected, fund shareholders panicked.

Some of the biggest managers on the II300 — Institutional Investor’s annual ranking of the 300 largest U.S. money managers, which oversee an aggregate $38.14 trillion in assets — are bond behemoths. So firms have a lot to lose if clients bolt or even moderate the money they’re socking away in bond funds. However, big allocations to fixed income can still make good sense. Robert Smith III, president of Sage Advisory Services, says that despite the short-term volatility, fixed-income investments are generally stable. “There is a long-term durability to this asset class,” he contends.

To view the complete ranking and firms’ portfolio breakouts, as well as lists of the biggest gainers and losers, click on the links in the navigation table at right.

To learn how II compiled the ranking, click on Methodology.

The II300 ranks America’s largest money managers by assets under management. In conformity with the traditional view of the money management business, assets are defined as discretionary assets under management for the accounts of customers for which an organization has contractual authority to make buy and sell decisions. Institutional Investor asks firms to report assets under management for their entire organizations — including subsidiaries. The ranking includes insurance companies, banks, investment management firms, internally managed pension funds, mutual fund firms and hedge funds. Domestic and non-U.S. equities include convertibles. American depositary receipts are included in non-U.S. equities. Domestic and non-U.S. fixed income includes preferred stock and mortgage-backed securities. Real estate includes debt and equity. Alternative investments may include derivatives, venture capital, oil and gas, timberland and hedge fund investments. Tax-exempt holdings represent assets from tax-exempt sources, such as pension funds, foundations and endowments. The ranking was compiled by Researchers Emily Kaemmerlen and Valentina McKenzie under the supervision of Senior Editor Jane B. Kenney.

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