Quantcast
The MFWire
Manage Email Alerts | Sponsorships | About MFWire | Who We Are

Subscribe to MFWire.com's News Alerts [click]

Rating:Does Kraus Have AllianceBernstein Stuck in a Negative Feedback Loop? Not Rated 0.0 Email Routing List Email & Route  Print Print
Tuesday, November 22, 2011

Does Kraus Have AllianceBernstein Stuck in a Negative Feedback Loop?

News summary by MFWire's editors

Fundsters, advisors and investors looking for reassurance about AllianceBernstein [see profile] and its chief, Peter Kraus (#27 on MFWire.com's 2010 list of top fundsters), probably won't find it in the new issue of Forbes. Halah Touryalai evaluates Kraus' tenure atop the New York-based asset manager and Axa subsidiary, asking in her headline "Why Can't Former Goldman Star Peter Kraus Stop the Asset Bleeding at AllianceBernstein?"

Pointing to Kraus' $29.6-million payday for three months of work at Merrill Lynch in 2008 and the $6 million upfront and the $50 million in possible stock awards headed his way when he jumped to AllianceBernstein, Forbes suggests that Kraus is "a poster boy for the kind of lopsided reward system Occupy Wall Street protesters are fuming about."

How is AllianceBernstein doing? Forbes notes that the mutual fund firm reach a peak of $837 billion in assets under management in 2007, dropped to $462 billion at the end of 2008 when Kraus took over, and fell further but slower over the past three years, now reaching $402 billion. The firm suffered $15.4 billion in net outflows last quarter, and its shares have dropped 20 percent since January 2009, and 39 percent year-to-date.

Turning to Credit Lynonais Securities Asia analyst Chris Spahr, Forbes wonders if AllianceBernstein is caught in a negative feedback loop, where market woes turn value investments into value traps when managers are forced to sell their winners to satisfy impatient investors who want out.

"The real question, however, may be whether Kraus hasn't gone far enough in his makeover of Alliance. He's disrupted the firm's culture and operations, but he is so far mostly sticking to the founder's investment approach," Forbes writes. "Post- 2008 fundamental analysis, as practiced by AllianceBernstein and many other firms, appears to be out. Is the change temporary or permanent?"

Columbia Business School professor Bruce Greenwald also weighed in for the article, and Forbes includes snippets from Kraus' comments on AllianceBernstein's third-quarter earnings call last month. 

Edited by: Neil Anderson, Managing Editor


Stay ahead of the news ... Sign up for our email alerts now
CLICK HERE

0.0
 Do You Recommend This Story?



GO TO: MFWire
Return to Top
 News Archives
2022: Q4Q3Q2Q1
2021: Q4Q3Q2Q1
2020: Q4Q3Q2Q1
2019: Q4Q3Q2Q1
2018: Q4Q3Q2Q1
2017: Q4Q3Q2Q1
2016: Q4Q3Q2Q1
2015: Q4Q3Q2Q1
2014: Q4Q3Q2Q1
2013: Q4Q3Q2Q1
2012: Q4Q3Q2Q1
2011: Q4Q3Q2Q1
2010: Q4Q3Q2Q1
2009: Q4Q3Q2Q1
2008: Q4Q3Q2Q1
2007: Q4Q3Q2Q1
2006: Q4Q3Q2Q1
2005: Q4Q3Q2Q1
2004: Q4Q3Q2Q1
2003: Q4Q3Q2Q1
2002: Q4Q3Q2Q1
 Subscribe via RSS:
Raw XML
Add to My Yahoo!
follow us in feedly


  1. MFDF Director Discussion Series - Open Forum via Zoom, December 7
  2. 2022 MMI Leadership Pathway Seminar, December 7
  3. 2022 Samfund Annual Celebration, December 7
  4. IMEA In Session - Cyber Security Trends, December 8
  5. U.S. Securities and Exchange Commission Investor Advisory Committee meeting, December 8
  6. MFDF webinar - Investment Valuation and Governance: Deloitte's 20th Annual Fair Valuation Pricing Survey, December 8
  7. Women in ETFs Philadelphia - Holiday Happy Hour With Project Home, December 8
  8. MMI webinar - Defining & Stimulating the Client Experience, December 9
  9. US SIF media webinar: US Sustainable Investing Trends 2022, December 12
  10. Vett Fi Advisor Perspectives Investment Insights Summit 2022, December 13
  11. IDC webinar - Spotlight on the SEC's Swing Pricing and Hard Close Proposals, December 14
  12. 2022 MMI Webinar Sponsored by the MMI Blockchain Finance Forum: Digital Asset Classification, December 14
  13. WE Boston: Annual Give Back Event 2022, December 14
  14. MFDF In Focus: Closed-End Fund Activism, December 14
  15. Crane Data's Money Fund University, Dec 15-16
  16. Crane Data's Holiday Cocktail Party, December 15
  17. MFDF webinar - Impact of 2022 Mid-Term Elections on the Financial Industry, January 10, 2023
  18. IDC's Foundations for Fund Directors, January 11 - 12, 2023
  19. MFDF 2023 Directors' Institute, January 23 - 25, 2023
  20. Exchange: an ETF Experience, February 5 - 8, 2023
  21. 8th Annual Expect Miracles in Manhattan, February 16, 2023
  22. MFDF webinar - Fund Industry Claims Trends: An Insurer's Perspective, March 1, 2023
  23. MFDF 2023 Fund Governance & Regulatory Insights Conference, March 9 - 10, 2023
  24. Crane Data's Bond Fund Symposium, March 23 - 24, 2023
  25. 2023 MMI Summit, March 29 - 30, 2023
  26. 34th Sub-Advised Funds Forum, April 3 - 4, 2023




©All rights reserved to InvestmentWires, Inc. 1997-2022
14 Wall Street | 20th Floor | New York, NY 10005 | P: 212-331-8968 | F: 212-331-8998
Privacy Policy :: Terms of Use