Just six days after Morgan Stanley closed on its all-stock E-Trade acquisition, the Wall Street bank said it will buy asset manager Eaton Vance in a deal valued at $7 billion. The latest transaction highlights the firm's big shift in focus under Chief Executive James Gorman.
Rebecca Ungarino took a look at why Morgan Stanley's bid for the storied asset manager gives it a leg up on rivals and signals more deals to come across the industry. We also mapped 4 asset-management firms that could be the next target, as consolidation pressures mount and other banks likewise look for steady businesses to iron out more volatile activities like trading.
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More below, including a performance roundup for big-name hedge funds, a deep dive on D1 Capital's Dan Sundheim, and the latest on Wall Street job cuts.
Hedge fund winners and losers
After three-quarters of chaos from the pandemic and upcoming election, hedge funds — on average — are where they started the year: flat. But individual performance is all over the map.
Stock-picking billionaires like Bill Ackman and Lee Ainslie are soaring while quants like Renaissance and Winton struggle. Bradley Saacks gave us a breakdown of how 13 big-name hedge funds are performing.
A day in the life of @MrsDowJones
Haley Sacks, 29, is an Instagram "finfluencer" who runs the @MrsDowJones account on Instagram (162,000 followers and counting.)
From debuting a clothing line to planning to roll out her own financial e-course, Sacks has developed a unique place for herself among the Wall Street and personal finance communities. She walked Business Insider's Reed Alexander through a typical workday.
The rise of Dan Sundheim
Dan Sundheim has quickly become an investor to follow since launching his fund D1 Capital after working as the chief investment officer at Andreas Halvorsen's Viking Global. His investing prowess has become stuff of legends, with D1 returning more than 78% after fees in its public-equity portfolio since it launched about two years ago.
Bradley Saacks and Alex Morrell talked with a dozen of his college classmates, coworkers, and people who've invested with him. Here's how a Wharton whiz kid became the LeBron James of investing, launched one of the hottest hedge funds on earth, and minted a billion-dollar fortune in the process.
Top law firms have been taking VC-style stakes in their own clients including Peloton and Snowflake
Venture-capital-style investments by law firms and their partners go back decades. Investing in clients has always been somewhat fraught, with some legal-ethics professionals saying it can cloud a lawyer's professional judgment and lead to conflicts. That's why firms that do take a stake in clients often take a relatively small one and often just for part of the fees that they charge, with the rest paid in cash.
As Silicon Valley's growth has continued, recent public disclosures have made clear that the practice hasn't died down. Jack Newsham dug through SEC filings to map out dozens of these kinds of bets.
Private-equity giants are racing to sell assets before year-end because they're worried about a bigger tax hit
Large private-equity firms are feeling pressure to sell assets before year-end to take advantage of a business-friendly tax regime they fear could change in 2021.
The thinking is that if Joe Biden is elected president and there is a Democratic majority in Congress, it will unleash a wave of larger taxes on corporations and wealthy individuals who manage them. And if Donald Trump remains in office, experts said that taxes may very well increase so that the government could fund COVID relief efforts.
One private-equity insider told Business Insider's Casey Sullivan that, in some deals, "it's just time" to sell. But he noted that selling on Dec. 31 versus Jan. 1 "would be a big delta in tax leakage if you believe rates are going up."
Future of the office
- IBM released a request for proposals this week to the New York City real-estate market in search of an office up to 500,000 square feet. The move comes as leasing activity has plunged and tenants hold an upper hand in lease negotiations, which could allow IBM to extract discounts. The new space will allow IBM to do more with less, catering flexibly to different functions and allowing workers to rotate in and out in a model that could become commonplace post-pandemic.
- Large banks have put stakes in the ground over this issue of working from home versus returning to the office. "It's complicated, and it's different for everybody," Goldman Sachs CEO David Solomon said in a recent town hall with employees, according to a partial transcript provided to Business Insider. "People have different obligations. I'd really like to encourage people to try to spend some time in office and try it out."
- Turnaround consultant AlixPartners is 'recruiting like crazy'. Its restructuring group leaders lay out how the firm is prepping for an influx of work and the benefits of virtual war rooms.
- Wall Street job cuts are back — here's the latest on what Goldman, Wells Fargo, JPMorgan, and other banks are doing
- Tech is coming to eat the $200 billion management-consulting industry's lunch. Here's a look at 4 factors disrupting how elite firms like BCG and McKinsey do business.
- 5 top law firms like White & Case and Mayer Brown run through their summer associate recruitment plans, from using '3D resumes' to interviewing students from lower-ranked schools
- Real-time payments in the US have increased five-fold in the past 12 months, according to a recent FIS survey. From payroll to bill pay, here's how companies are using the tech.
- Booming demand for lab space is a rare bright spot for real-estate developers. But a steep learning curve means some 'stupid money' investors could get burned.
- An inside look at Harbor, a new disaster prep app developed by Headspace and GoodRx alums that helps you get your home ready for hurricanes, wildfires, and other catastrophes
- Compass, the SoftBank-backed real estate brokerage, just acquired a startup that brings it one step closer to becoming a one-stop shop for buying and selling homes
- More energy costs are being footed by employees working from home. Here's what this means for office landlords and how one provider is working with employers to pay the difference.
We are also looking for nominations for our first-ever Rising Stars of Real Estate. Get all the details on how to apply here.
- Greenberg Traurig just poached 5 more privacy and data-security lawyers, bulking up in a practice area that's booming as clients rush to navigate new regulation and safeguard sensitive information
- The head of the biggest immigration law firm in the US explains how a recently acquired Y Combinator-backed startup will play a key role in its plans to compete with the Big 4
- How litigation financing startup Legalist plans to leverage its tech to scale up to $1 billion in assets under management
- #DropExxon: Pressure is mounting on Big Law to combat climate change as 600 students pledge to boycott Paul Weiss for defending the oil giant
- Here's the pitch deck that Koala, a startup bringing an Airbnb-style marketplace to the wonky timeshare industry, used to raise $3.4 million
- An instant-paycheck startup used this 11-slide pitch deck showing a big opportunity in hourly workers' 'liquidity gap' to nab a $4.5 million seed round led by Upfront Ventures
Want to hear from the leaders of digital transformation in finance? Insider Intelligence is hosting two free webinars called “The Bank Insider Panel – Acting on Consumers’ Accelerating Digital Adoption.” Click here to reserve your spot.Learn more about the financial services industry
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