(Pictured: David Kabiller)
AQR Capital Management is to fund a new research institute for the asset management industry to be run by the London Business School. The partnership, which has a 10-year commitment from AQR, aims at advancing research and best practice in the industry globally.
The US$122 billion quant-oriented equities firm, which was founded in 1998 by Cliff Asness, David Kabiller and John Liew, who remain majority partners along with other staff, has long emphasized the importance of research in its own work. An affiliate of the Affiliated Managers Group (AMG) for the past 10 years, AQR has now become one of the most significant corporate partners of the London Business School.
Kabiller said in a statement last week: “We were drawn to creating a premier academic venue that would foster thought leadership and promote excellence in asset management. The AQR Institute will bring together scholars and industry-leading practitioners to produce original research and identify best practices from a global perspective. We are proud to partner with the London Business School which is renowned for its academic rigour, top faculty and diverse student body.”
The institute will fund and generate research in asset management, provide scholarships and engage in various outreach activities, such as event sponsorships to bring together academics, policy makers and practitioners.
The four key academics at the institute’s core are finance professors Francisco Gomes, Ralph Koijen and Narayan Naik and economics professor Helene Rey. Non-executive chair of the institute is adjunct professor Robert Jenkins. There will also be an advisory council consisting of both academics and fund managers.
Perhaps not coincidentally, AQR announced last month that its principals had signed up for another 10 years with AMG affiliation, allowing AMG to buy more of its shares (although still a minority) and that proceeds from the transaction would be invested by AQR.
The initiative follows that set up in 2007 by another former quant manager, Paul Woolley, with three universities: the London School of Economics, University of Toulouse and University of Technology, Sydney. Woolley, a successful UK partner with GMO, has largely funded his research program privately. Their work focuses on “capital markets dysfunctionality”.