In this look at the world's top portfolio managers, Citywire focused on some of the potential stars of tomorrow. These names may not be well known today but could be tomorrow's Warren Buffett, George Soros or Jeffrey Gundlach.
It's fair to say that portfolio management is not a young person's game and is dominated by veterans, most of whom are men.
To that point, of the 15,000 portfolio managers tracked by Citywire, the average age is 49 and 89 percent are men. The age range is extreme, with the oldest coming in at a respectable 77 and the youngest being 24 years old. In this ranking, Citywire looked at 20 of the top managers worldwide who are age 40 and under.
The portfolio managers are ranked based on their manager ratios over a three-year period until the end of January. This measure, created by Citywire, assesses the value added by each manager and factors in the risks each manager has taken.
What makes this list so special is just how tough the past three years have been for active fund management, with only 27 percent of portfolio managers outperforming their indices globally.
Not only have the portfolio managers on this list outperformed, but they have smashed their benchmarks, all receiving the highest possible Citywire rating, AAA, over that period.
Occupying the top spot is Belle Haven Investments' Brian Steeves, manager of the Transamerica Intermediate Muni fund. Steeves, 31, who hails from Wappingers Falls, New York, is among the youngest managers in the Citywire database.
Municipal bonds have had a great three years, with portfolio managers in this category regularly topping our global lists, as the steady risk-reward profile in this market has been ripe for consistent outperformance. However, after an astonishing run, the last three months of 2016 was something of a cold shower, with the intermediate index falling 4 percent.
This resulted in some $20 billion of outflows from actively managed muni portfolios. This left the sector with a small negative return of -0.3 percent for the full calendar year. Despite the turbulent end to 2016, Steeves' strategy still broke even. There is an old adage that an active manager really proves their worth when times get tough, so watch this space.
More from Portfolio Perspective:
Advisor jury still out on active management
Bond investors must adjust their expectations
Are your investments really diversified enough?
The category with the most managers represented on this list was Indian equities. Four of the 20 managers ply their trade here, and all of them are Indian-educated, reflecting the truly global nature of investment.
The top of this set is Vinay Agarwal, 39, who comes in third on the list for his management of the First State Indian Subcontinent and First State Regional India funds. First State is one of the premier emerging market fund shops in the world, and its expertise in India has been the source of much of their outperformance in recent years.
As mentioned earlier, portfolio management is an overwhelmingly male-dominated industry, and only one portfolio manager on this list was female.
Based in Estonia, Jelena Rozenfeld, 35, is manager of the Trigon Russia Top Picks fund. Russian equities have been on a tear in recent months, and Rozenfeld has taken advantage, putting up some truly impressive numbers.
The fund has returned 98.7 percent in dollar terms over the past 12 months, nearly double the 56.2 percent made by the Russian RTS Index over that time. What makes Rozenfeld's returns so impressive is that even during the tougher times, she did not underperform the index.
Rozenfeld is not the only Estonian fund manager on the list. Valdur Jaht, 36, also made the cut. Jaht manages the Avaron Emerging Europe fund, which invests in emerging Europe, excluding Russia.
— By Frank Talbot, head of investment research at Citywire www.citywireusa.com
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