Defying assumptions, Dan Chung, chief govt officer of Fred Alger Administration, rebuilt the funding staff and, certainly, the complete cash administration agency after it misplaced 35 folks within the assaults on the World Commerce Heart on Sept. 11, 2001.
CEO David Alger had perished within the North Tower, and Chung, who had simply turned 39, instantly turned the agency’s chief. Founder Fred Alger, David’s brother, was retired and residing in Switzerland.
“If you wish to speak about which corporations had the perfect enterprise restoration after 9/11, I feel Alger can be among the many High 10 of any business,” Chung says in an interview with ThinkAdvisor. “Within the funding world, I feel we’re No. 1.”
Chung, who just lately acquired a 2023 ThinkAdvisor LUMINARIES award for neighborhood affect, discusses management classes he realized on the helm of the growth-investing boutique in addition to current developments capitalized on, akin to actively managed ETFs.
Chung, now 61, who turned CEO in 2006 after his appointment as president three years earlier, brings up just a few of his management “weaknesses,” as he calls them, and advises hiring proficient folks to “complement” any shortcomings.
“I do know that I’m not a pure gross sales [and marketing] govt …,” he says. “Maybe if I had been [one] with numerous that have, as an alternative of the agency [managing assets of] $22 billion immediately, we might be at $60 billion.”
Chung joined Alger in 1994, after 4 years as a lawyer. Earlier than taking on, he served as a senior analyst on the funding staff, portfolio supervisor and head of know-how.
Within the telephone interview with Chung, who was talking from his workplace at Alger headquarters in New York, he notes his excessive hopes for synthetic intelligence, “a megatrend,” which, he says, will assist advisors “the place used accurately.”
Listed here are excerpts from our dialog:
THINKADVISOR: When Fred Alger Administration misplaced 35 folks on 9/11, amongst them David Alger, the agency’s chief, you instantly turned chief funding officer and head of the agency. What was the business saying about Alger’s future?
There was loads of doubt on Wall Road whether or not we might survive. Most anticipated us to exit of enterprise.
Most consultants and advisors put us on maintain or terminated us. They weren’t investing new cash with us for a number of years, watching whether or not we may survive.
In 2006, you have been named CEO. What’s your largest management success?
Rebuilding the funding staff, producing funding efficiency, rebuilding the agency and in the end successful again shoppers.
We have been one of many hardest-hit corporations [on 9/11] and, as a boutique, not one of many larger ones.
However if you wish to speak about which corporations had the perfect enterprise restoration after 9/11, I feel Alger can be among the many High 10 of any business. Within the funding world, l assume we’re No. 1.
Have you ever made any management errors?
Not a mistake — however maybe if I had been a gross sales and advertising and marketing govt with numerous that have, as an alternative of the agency [managing assets of] $22 billion immediately, we might be at $60 billion.
What current developments have you ever aggressively capitalized on?
We strive to not comply with developments for the sake of developments. We attempt to hearken to our shoppers, and once we see a requirement for one thing, we wish to meet it.
For instance, beginning in 2020, we launched actively managed ETFs. That’s been giving traders preferring the liquidity and tax effectivity of ETFs a method to put money into a number of of our methods that had been in mutual funds.
We’re additionally seeing curiosity amongst traders in U.S. progress equities abroad, akin to in Europe and Asia. So we’ve been investing in these and employed two senior vice presidents to move enterprise growth.
What developments do you see on the horizon?
I and the remainder of the funding staff are very targeted on AI and the way it’s going to development for a lot of industries, services.
We see AI as a megatrend that’s driving funding alternative on all ranges and in all sectors.
How will it’s utilized in enterprise?
AI could have functions each internally for companies to enhance their advertising and marketing and gross sales, and manufacturing and logistics effectivity.
It’s additionally going to create loads of alternative for firms that present the know-how, whether or not it’s software program, {hardware} or information analytics.
We’re very within the AI development and who would be the suppliers of know-how and providers which might be powered by AI, in addition to how it will likely be utilized and what firms will profit from it.
How will AI profit monetary advisors?
It may actually assist advisors, the place used accurately, in servicing shoppers and preserving them higher knowledgeable and in serving to advisors grow to be extra environment friendly within the again workplace.
However it’s undoubtedly going to be a problem. The place you’re not in a position to compete on a know-how foundation, you may compete on a special foundation, like customized service and understanding your shoppers. I don’t assume AI will likely be up for that job for a very long time.
What management classes are you able to share?
Recognizing that having a tradition that rewards laborious work and efficiency, a meritocracy, is essential. We let expertise rise by the ranks after they’re fairly younger.