Gary P. Brinson

Last updated
Gary P. Brinson
Born1943
Seattle, Washington
Alma mater Seattle University (BA, 1966)
Washington State University (MBA, 1968)
Occupation Investment management
Employer(s) UBS (Retired)
Brinson Partners (Prior)
First National Bank of Chicago (Prior)
Known forResearch on asset allocation
Founder of Brinson Partners

Gary P. Brinson is a former investor and money manager. He is the founder of Brinson Partners a Chicago-based asset management firm acquired in 1994 by Swiss Bank Corporation, the predecessor of UBS, and Adams Street Partners. Prior to retiring in 2000, Brinson would run the asset management division of Swiss Bank Corporation and later UBS Global Asset Management.

Contents

He is the co-author of two books on global investing and has authored numerous articles on an array of investment topics. Brinson has been called one of the investment field's "Living Legends" alongside investors such as George Russell, Jr., Warren Buffett, and Bill Gross. [1]

Career

Brinson was born in Seattle, Washington in 1943. His father worked as a bus driver and his mother worked at Sears as a clerk. He graduated from Seattle University in 1966 and would go on to receive an MBA from Washington State University in 1968. [1]

Brinson entered the investment management business in the late 1960s as an analyst at Travelers Insurance Company. In 1979, Brinson left Travelers to join the trust department of First National Bank of Chicago as chief investment officer. By 1981, Brinson had assembled the team that would become First Chicago Investment Advisors and later Brinson Partners. [2]

First Chicago Investment Advisors became a separate money management company in 1983. Through the 1980s, Brinson established himself as a pioneer in the development of the theory of asset allocation. [3] Brinson pushed for allocation across stocks, bonds, cash, real estate, venture capital and other alternative asset classes using simple cost effective investment strategies. This would largely become conventional wisdom among money managers in the 1990s. [4]

In 1989, Brinson led a US$100 million management buyout of his firm from First Chicago Corporation, acquiring approximately 75% of the company with a large group of partners and investors. Over the next five years, he built up the firm to approximately US$36 billion of assets under management. Brinson focused on providing access for U.S. institutions to global markets. The firm, which also managed a series of mutual funds, had emerged as one of the largest managers of pension plans in the U.S. [4]

In 1994, Swiss Bank Corporation was in the midst of a series of acquisitions that included O'Connor & Associates, S.G. Warburg & Co., Dillon Read & Co. and culminated in the bank's merger with the Union Bank of Switzerland in 1998. Swiss Bank announced the acquisition of Brinson Partners and brought in Brinson to run the bank's asset management unit. [5] Swiss Bank Corporation paid US$750 million to acquire Brinson Partners, resulting in a profit to Brinson and his partners of US$460 million on the sale of their 75% stake in the company. [4]

Following the acquisition of Brinson Partners, Gary Brinson ran Swiss Bank's asset management business and after the merger with UBS, Brinson was named chief investment officer of UBS Global Asset Management. [6]

Brinson retired from UBS in early 2000 just prior to the crash of the dot-com bubble. Brinson had grown disenfranchised over the previous years with the runaway internet bubble and its detachment from fundamentals and value investing. [7]

Influence on investment and finance

Brison is acknowledged for helping to establish the foundations of investment portfolio Performance Attribution by introducing the Brinson model, through two articles written by Brinson and Fachler (1985) and Brinson, Hood, and Beebower (1986). [8]

Other affiliations

Brinson established the Brinson Foundation as non-profit organization focused on supporting educational, public health, and scientific research programs. [9]

Related Research Articles

Private equity (PE) is stock in a private company that does not offer stock to the general public. In the field of finance, private equity is offered instead to specialized investment funds and limited partnerships that take an active role in the management and structuring of the companies. In casual usage, "private equity" can refer to these investment firms, rather than the companies in which they invest.

<span class="mw-page-title-main">Union Bank of Switzerland</span> Swiss investment bank and financial services company

Union Bank of Switzerland (UBS) was a Swiss investment bank and financial services company located in Switzerland. The bank, which at the time was the second largest bank in Switzerland, merged with Swiss Bank Corporation in 1998 to become UBS. This merger formed what was then the largest bank in Europe and the second largest bank in the world.

Swiss Bank Corporation was a Swiss investment bank and financial services company located in Switzerland. Prior to its merger, the bank was the third largest in Switzerland, with over CHF 300 billion of assets and CHF 11.7 billion of equity.

<span class="mw-page-title-main">Wasserstein Perella & Co.</span> American investment bank

Wasserstein Perella & Co. was a boutique investment bank established by Bruce Wasserstein, Joseph R. Perella, Bill Lambert, and Charles Ward in 1988, former bankers at First Boston Corp., until its eventual sale to Dresdner Bank in 2000 for some $1.4 billion in stock. The private equity business of the investment firm was not included in the sale and was to be sold off to existing Wasserstein shareholders.

<span class="mw-page-title-main">Asset allocation</span> Investment strategy

Asset allocation is the implementation of an investment strategy that attempts to balance risk versus reward by adjusting the percentage of each asset in an investment portfolio according to the investor's risk tolerance, goals and investment time frame. The focus is on the characteristics of the overall portfolio. Such a strategy contrasts with an approach that focuses on individual assets.

S. G. Warburg & Co. was a London-based investment bank. It was listed on the London Stock Exchange and was once a constituent of the FTSE 100 Index. The firm was acquired by the Swiss Bank Corporation in 1995 and ultimately became a part of UBS.

Dillon, Read & Co. was an investment bank based in New York City. In 1991, it was acquired by Barings Bank and, in 1997, it was acquired by Swiss Bank Corporation, which was in turn acquired by UBS in 1998.

In finance, the private-equity secondary market refers to the buying and selling of pre-existing investor commitments to private-equity and other alternative investment funds. Given the absence of established trading markets for these interests, the transfer of interests in private-equity funds as well as hedge funds can be more complex and labor-intensive.

<span class="mw-page-title-main">Private equity firm</span> Firm that invests in privately held companies

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Performance attribution, or investment performance attribution is a set of techniques that performance analysts use to explain why a portfolio's performance differed from the benchmark. This difference between the portfolio return and the benchmark return is known as the active return. The active return is the component of a portfolio's performance that arises from the fact that the portfolio is actively managed.

Phillips & Drew was a large stockbroking partnership and company based in the City of London, England. It was fully acquired by the Union Bank of Switzerland in 1986, which itself merged with the Swiss Bank Corporation in 1998, to become UBS AG.

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<span class="mw-page-title-main">UBS</span> Multinational investment bank headquartered in Switzerland

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O'Connor & Associates was a Chicago-based options trading firm, with a particular emphasis on financial derivatives. The firm was founded in 1977 by Edmund J O'Connor and his brother William O`Connor. In 1992, O'Connor & Associates was acquired by Swiss Bank Corporation. The acquisition was part of Swiss Bank's efforts to expand its options trading capabilities in the United States. At the time of the acquisition, O'Connor & Associates had over 500 employees and was one of the largest options trading firms in the world.

Brinson Partners was an asset management firm focused on providing access for U.S. institutions to global markets. The firm was founded by noted investor Gary P. Brinson in the 1980s and established as an independent firm in 1989. Brinson was acquired by Swiss Bank Corporation in 1994 and became the core of the Swiss bank's asset management business in the U.S.

John P. Costas is an American businessman, banker, and trader. He is the former chairman and CEO of UBS Investment Bank, where he oversaw the growth of the Swiss bank's investment banking franchise globally from 2000 to 2005. From 2005 through 2007, Costas was the chairman and CEO of Dillon Read Capital Management, a UBS proprietary trading unit and alternatives management company.

<span class="mw-page-title-main">Jürg Zeltner</span> Swiss businessman (1967–2020)

Jürg Zeltner was a Swiss corporate executive. He last served as Group CEO and member of the Board of Directors at KBL European Private Bankers. He was earlier the President of UBS Wealth Management from November 2014 to December 2017. He stepped down from the Group Executive Board at the end of 2017, and retired from the firm as of 2018. He had served as a member of the UBS Group Executive Board since February 2009. From February 2009 to January 2012 he was co-CEO of Wealth Management and Swiss Bank. In February 2016, Zeltner ranked first among the best global private banking CEOs, according to a 2016 Euromoney private banking survey.

In finance, active return refers to the returns produced by an investment portfolio due to active management decisions made by the portfolio manager that cannot be explained by the portfolio's exposure to returns or to risks in the portfolio's investment benchmark; active return is usually the objective of active management and subject of performance attribution. In contrast, passive returns refers to returns produced by an investment portfolio due to its exposure to returns of its benchmark. Passive returns can be obtained deliberately through passive tracking of the portfolio benchmark or obtained inadvertently through an investment process unrelated to tracking the index.

<span class="mw-page-title-main">Adams Street Partners</span> Investment firm based in Chicago

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References

  1. 1 2 Gary P. Brinson Archived 2011-06-10 at the Wayback Machine . Horatio Alger Society
  2. ↑ Gary Brinson Archived 2010-11-01 at the Wayback Machine . CFA Journal Interview, 1999
  3. ↑ Gary P. Brinson, L. Randolph Hood, and Gilbert L. Beebower, Determinants of Portfolio Performance, The Financial Analysts Journal, July/August 1986. Determinants of Portfolio Performance II: An Update, The Financial Analysts Journal, 47, 3 (1991)
  4. 1 2 3 Merger in Switzerland Creates a Star in Chicago. New York Times, December 14, 1997
  5. ↑ SBC Warburg Company History. Funding Universe, Retrieved August 10, 2010
  6. ↑ UBS-SBC Would be Largest Manager Yet: Gary Brinson May Lead Institutional Side. Pensions & Investments, December 8, 1997
  7. ↑ How market's shift dislodged Gary Brinson: `Value investor' retiring from money management biz. Crains Chicago Business, March 13, 2000
  8. ↑ "Return Attribution". CFA Institute. 2012. Retrieved 2020-05-11.
  9. ↑ "Gary P. Brinson". Inside Philanthropy. 2019-12-19. Retrieved 2023-08-28.
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