2018 Knowledge Brokers

Jay Love

As US director of strategic research at consulting firm Mercer, Jay Love works with around eight institutional investing clients at a time, helping them with everything from asset allocation or modeling their liabilities, in the case of corporate defined benefit pension plans, to building multi-manager funds for defined contribution plans.  

That’s just one of his jobs at Mercer. He also helps hundreds of other Mercer consultants communicate efficiently when talking to their clients about Mercer’s latest thinking about financial topics.

The Mercer partner has been at the firm for 23 years, and he says working in a variety of investment areas at the consultancy has helped him become a more effective consultant.

“I’m one of the more senior people and recognizable faces of Mercer, but I don’t think that I am some super consultant,” said Love, who is based in Atlanta. “It is a combination of having experience, understanding clients, and being able to harness all our resources to deliver it to them. I think it’s our resources and collective knowledge that make me look good.”

Love will also work with clients to put together multi-manager portfolios to manage specific assets.

“If the client has $1 billion in large-cap non-US equity, we might allocate anywhere from three to five active managers,” he said. “We must find managers that are not only likely to succeed individually but that are also complimentary to each other in order to create a portfolio that can provide consistent, strong performance. A big part of what we do is finding good managers and then understanding their relationships and common drivers.”

In an expected low-return environment going forward, Love said it’s a difficult environment for institutional investors.

“There’s not a whole lot of things that look super attractive right now in terms of valuations, so we think absolute return-oriented strategies and alpha more generally is likely to be effective; there’s still strong potential there,” he said.

Love is aware that the absolute return strategies, sometimes a euphemism for hedge funds, are at first glance not always appealing to institutional investors.

“Hedge funds are challenging because they are high fee and opaque, and you can’t get always get a good look at what’s going on,” he said. So, “all of those are important things and they need to be managed well.”

He said making the right absolute return or hedge fund investment is important.

“Hopefully we and all of our clients are long past the idea of just dumping money into some generic fund of funds,” he said. “When we’re doing these kinds of alpha or absolute return strategies, we want to make sure our clients have a strong understanding of what they’re going into.”

In terms of helping his fellow Mercer consultants, Love’s advice is this in communicating with clients: “You have to know what you are presenting inside and out,” he said.

“Be sure that you know as much as you possibly can about the topic you are going to be talking about,” he went on. “Your knowledge will show in your confidence, and it will be apparent from the way you’re presenting. You will be much more effective in helping clients understand the concepts and have confidence that they’re making the right moves if they have confidence in you.”

By Randy Diamond

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