Spanish boutiques outperform larger rivals in first half

Eugenia Jiménez
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The performance of funds in Spain is polarised between smaller and independent firms and those funds from larger asset managers, H1 data suggested.

azValor, Metagestión and Gesiuris Asset Management achieved the stronger average annual returns from January to June according to the financial markets data provider VDOS.

azValor took top spot with return averaging 3.42% over the period, according to VDOS. The independent boutique, based in Madrid and characterised by its value investment philosophy, was launched by the former managers of Bestinver Álvaro Guzmán, Fernando Bernad and Beltrán Paragés.
Since the launch of two of its main funds, – the azValor Iberia – an equity fund investing in the Spanish Stock Exchange – and the azValor International, a global equity fund focused on Europe – the independent boutique has beaten the market.

In second place, Metagestión’s funds recorded average annual returns of 2.6% over the first six months of the year. In particular, the firm’s Spanish equity fund Metavalor achieved returns of nearly 7% during the same period.

Gesiuris AM returned 2.6% annually on average, with its fund Valentum – one of its flagships strategies to leave the firm soon – returning 8.7% and achieving an annual revaluation of 13.4%. The firm’s Japanese Stock Exchange fund, the Japan Deep Value Fund returned 3% during the first half but above 37% in the previous year.

EDM Gestión recorded average annual returns of 2.32% and its Spanish equity fund, the EDM-Inversión -, revalued itself 3.5% this year and 8.3% annually during the past five years.

Conversely, all funds managed by larger investment houses belonging to banking groups underperformed over the first half of the year. Funds from Fineco, BBVA Asset Management, Gestifonsa and Santander Asset Management underperformed 0.7% on average.


According to some within the funds’ industry, there are different reasons that could explain this phenomenon. For instance, boutique managers do not have the benchmark constraints that are linked with many institutions, which could partly explain why the performance of boutique funds is stronger.

Independent boutiques normally manage a smaller range of funds and, generally, focus on equity funds, which is currently the most profitable asset class. In contrast, funds from larger companies dependent on financial institutions, manage funds of all type of asset classes which makes them more vulnerable to losses.

Also, larger investment firms tend to focus more on marketing and attracting flows into their funds. Eight out of ten euros invested in funds in Spain is poured into larger investment houses associated to banking institutions. This could led into fund managers controlling big amounts of money, which could become a problem if it compromises their investment approach.


Another important consideration is the alignment of interest that typically exists within boutiques between the fund manager and end-investor.

Javier Velasco, fund manager and fund selector at Spain’s Andbank, admits to favour boutiques’ funds as long as they add alpha and value to the management.

“Boutiques or smaller independent fund firms normally provide higher returns than larger investment firms for various reasons. The first, is the alignment of interests that usually exists between boutiques’ fund managers and investors. It is explained by the fact that most of them invest their own money in the funds they manage and/or in the shares of the firm.

“Also, boutiques’ fund managers normally take more risks, hence the structure commissions existing in those companies is more attractive than that from bigger banking firms. On average, boutiques fund managers’ commissions are lower but there is a substantial “award” for those performing well. This means the fund manager gets the commission just if achieves returns resulting usually in higher returns of boutiques’ funds.

In addition, larger fund houses associated to banks do normally manage funds with low risks taking advantage from the big market’s shares they have to obtain easy performances.”

Eugenia Jiménez
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Eugenia Jiménez

Eugenia Jiménez speaks Spanish and is Iberia Correspondent for Investment Europe covering Spain & Portugal, as well as Italy.

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