Minority-owned Holland Capital Management shuts down in Chicago – Finance News

on Aug19

16 August 2017 | 1:00 pm

Holland Capital Management, one of Chicago’s largest minority-owned asset management firms, said it is shutting down after 26 years in business.

The firm, which is also one of Chicago’s few woman-owned asset managers, said in a statement last night that over the next several months it will be winding down the business, which currently oversees about $2.5 billion for institutional investors like pensions. Holland, which is led by CEO, owner and co-founder Monica Walker, blamed industry “headwinds” for hurting the firm’s strategy of investing in growth stocks.

“Industry trends over the past several years have presented considerable headwinds for long-only active equity managers,” the firm said in the statement. “Most notably, the flight from active management to passive management and increasing fee compression within the industry have negatively impacted Holland Capital’s business.”

Active investment management firms, like Holland, pick stocks they expect to rise in value; they’ve been hard-pressed to compete with lower-priced, passive strategies, like index-linked funds, that climb with overall market increases. The passive investments have surged along with market indexes such as the Standard & Poor’s 500 Index, which has increased nearly 16 percent over the past year.

Holland is dwarfed by the biggest managers in the industry that oversee tens of billions of dollars for institutional investors, but it’s larger than the smallest, which sometimes manage just hundreds of millions. Among Holland’s clients was the Illinois State Universities Retirement System. Other larger Chicago-area asset managers, including Driehaus Capital Management and Calamos Investments, have also suffered in the face of the industry’s changes over the past few years.

Holland, founded in 1991, said in the statement that Walker and the board decided to begin this process while its balance sheet remains strong. It will work with clients to transition their accounts. For her part, Walker decided it was time to explore interests and opportunities outside the industry, according to the statement.

Holland’s eponymous co-founder, Louis Holland, retired in 2008 and died last year.



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