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Defying assumptions, Dan Chung, chief government officer of Fred Alger Administration, rebuilt the funding workforce and, certainly, the complete cash administration agency after it misplaced 35 individuals within the assaults on the World Commerce Middle on Sept. 11, 2001.
CEO David Alger had perished within the North Tower, and Chung, who had simply turned 39, instantly grew to become 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 one of the best enterprise restoration after 9/11, I believe Alger could be among the many Prime 10 of any trade,” Chung says in an interview with ThinkAdvisor. “Within the funding world, I believe we’re No. 1.”
Chung, who not too long ago acquired a 2023 ThinkAdvisor LUMINARIES award for neighborhood influence, discusses management classes he realized on the helm of the growth-investing boutique in addition to current developments capitalized on, similar to actively managed ETFs.
Chung, now 61, who grew to become CEO in 2006 after his appointment as president three years earlier, brings up a couple of of his management “weaknesses,” as he calls them, and advises hiring gifted individuals to “complement” any shortcomings.
“I do know that I’m not a pure gross sales [and marketing] government …,” he says. “Maybe if I had been [one] with numerous that have, as a substitute of the agency [managing assets of] $22 billion right this moment, we might be at $60 billion.”
Chung joined Alger in 1994, after 4 years as a lawyer. Earlier than taking up, he served as a senior analyst on the funding workforce, portfolio supervisor and head of expertise.
Within the cellphone 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 below are excerpts from our dialog:
THINKADVISOR: When Fred Alger Administration misplaced 35 individuals on 9/11, amongst them David Alger, the agency’s chief, you instantly grew to become chief funding officer and head of the agency. What was the trade saying about Alger’s future?
There was numerous doubt on Wall Avenue 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 greatest management success?
Rebuilding the funding workforce, 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 greater ones.
However if you wish to speak about which corporations had one of the best enterprise restoration after 9/11, I believe Alger could be among the many Prime 10 of any trade. 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 government with numerous that have, as a substitute of the agency [managing assets of] $22 billion right this moment, we might be at $60 billion.
What current developments have you ever aggressively capitalized on?
We attempt to not comply with developments for the sake of developments. We attempt to take heed to our shoppers, and once we see a requirement for one thing, we need to meet it.
For instance, beginning in 2020, we launched actively managed ETFs. That’s been giving buyers preferring the liquidity and tax effectivity of ETFs a approach to spend money on a number of of our methods that had been in mutual funds.
We’re additionally seeing curiosity amongst buyers in U.S. development equities abroad, similar to in Europe and Asia. So we’ve been investing in these and employed two senior vice presidents to move enterprise improvement.
What developments do you see on the horizon?
I and the remainder of the funding workforce are very targeted on AI and the way it’s going to pattern 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 may 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 numerous alternative for corporations that present the expertise, whether or not it’s software program, {hardware} or knowledge analytics.
We’re very within the AI pattern and who would be the suppliers of expertise and companies which can be powered by AI, in addition to how will probably be utilized and what corporations will profit from it.
How will AI profit monetary advisors?
It may actually assist advisors, the place used accurately, in servicing shoppers and maintaining them higher knowledgeable and in serving to advisors turn out to be extra environment friendly within the again workplace.
Nevertheless it’s positively going to be a problem. The place you’re not in a position to compete on a expertise foundation, you possibly can compete on a unique foundation, like personalised service and understanding your shoppers. I don’t assume AI will probably 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 onerous work and efficiency, a meritocracy, is essential. We let expertise rise by way of the ranks after they’re fairly younger.
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