Harbour Navigator: Beyond horsepower - identifying managers with a winning edge

Many investment firms emphasise process and discipline, but PIMCO has taken the additional step of formally incorporating behavioural science into its investment process. The objective is straightforward: improve the quality of investment decisions by recognising and mitigating the biases that can affect even the most experienced investors.

A key insight underpinning PIMCO’s approach is that biases are difficult to eliminate at the individual level. Rather than attempting to “de-bias” people, PIMCO focuses on building decision-making processes that minimise the influence of predictable behavioural errors. This is supported by a dedicated behavioural science team that works closely with the investment team, as well as partnerships with leading academic institutions.

The firm's emphasis on decision-making is particularly evident in its investment committees and economic forums. Participants are often required to submit their views independently before discussions begin, helping to prevent opinions from being shaped by seniority, consensus, or dominant personalities. Senior figures often speak last to avoid influencing early discussion. This encourages genuine diversity of thought and helps ensure a wider range of perspectives are considered when making investment decisions. It reduces the risk of groupthink.

Another feature that differentiates PIMCO is its Global Advisory Board, which includes internationally recognised leaders in economics, politics, and public policy (such as Gordon Brown and Janet Yellen). The Board participates in PIMCO’s investment forums and contributes insights that help shape the firm's economic outlook and investment views. This additional layer of expertise enriches the conversation and broadens the amount of information available to investment teams when assessing risks and opportunities.

TPG (global private equity manager)

San Francisco, where TPG has one of its two HQs

Several of the large global private equity managers invest broadly across the entire economy. One of the things we like about TPG is the insight it has due to its focus on five sectors that have long-term secular growth tailwinds (i.e. Healthcare, Technology, Consumer, Business Services, and Climate). This specialisation and deep sector expertise is what helps TPG identify attractive opportunities at the forefront of industry transformation.

Its creative dealmaking also stands out and leads to unique opportunities being realised. This includes investing in businesses receiving capital from an institutional investor for the first time, and partnering with corporations to either unlock value from non-core assets or helping them create and scale new businesses. A good example is TPG’s recent partnership with OpenAI to establish DeployCo, which embeds engineers skilled in advanced AI systems directly into businesses to help them implement customised AI tools into their workflows.

The way in which TPG engages with its portfolio companies is another differentiator. Its approach is one of active ownership and hands-on value creation. Most of the value it creates across its buyout investments relies on driving top-line growth¹, digital transformation, and strategic acquisitions rather than basic cost cutting. It was one of the pioneers in the industry to have a dedicated internal team of operations professionals focused on strategic, commercial, technological, and operational improvements across its portfolio companies. Today, this team comprises 50 senior operations professionals, who are deeply involved throughout the investment journey – from the due diligence of a business and assessing the management team, to implementing a value creation plan.  

Nuveen is a recently appointed global equity manager that employs a quality-oriented investment approach.³ At many investment firms, analysts are responsible for generating research and recommending ideas to portfolio managers. The analysts don’t manage money, rather that is the role of the portfolio managers. Nuveen takes a different approach. Many of its analysts are also responsible for managing sector-specific portfolios containing real client capital. This distinction may appear subtle, but it has important implications. Managing real money creates a different level of accountability and ownership. Analysts must not only identify attractive opportunities, but they must also make investment decisions and live with the consequences of those decisions. We believe this fosters a stronger investment mindset and encourages greater conviction in their highest-quality ideas. 

This structure also creates a more effective link between research and portfolio construction. Because analysts manage capital directly, their investment views are expressed through their portfolio positions, rather than theoretical recommendations. This provides portfolio managers with a clearer signal regarding the strength of an analyst's conviction in a particular company. 

Nuveen's scale, with assets under management of US$1.4 trillion⁴, also provides the analysts and portfolio managers with significant access to the management teams of companies. By contrast, smaller investment management firms simply won’t get the same level of access to these individuals. Importantly, large managers like Nuveen also have better traction engaging with companies on environmental, social and governance issues.

Acadian (global equity manager)

Boston, the home of Acadian

Acadian is a global investment manager that takes a systematic approach to investing. Founded in Boston in 1986, the firm has been at the forefront of systematic investing for four decades, continually evolving its use of data, technology and advanced analytical techniques, including machine learning and artificial intelligence. Its investment process combines a broad range of proprietary signals spanning company-specific insights, country and industry themes, and peer linkages between securities. AI and natural language processing also allow Acadian to analyse large volumes of unstructured information that would be difficult to process consistently through traditional analysis alone.

Underpinning Acadian's approach is a global research and technology platform designed to analyse a broad investment universe and large volumes of data. Rather than relying on a single breakthrough insight, its approach is perhaps more analogous to a Formula One team pursuing incremental gains: continuously researching new ideas, refining existing signals and retiring those that may have become less efficacious over time. The aim is to identify diversified, repeatable sources of alpha rather than relying on a small number of concentrated bets.

Behind the process is a multidisciplinary team bringing together expertise across finance, mathematics, engineering, computer science and other quantitative disciplines, supported by a substantial technology capability and proprietary infrastructure. As with a Formula One team, the edge is not attributable to any single component, but to how the people, research, data, technology and implementation work together as a system.

Our external manager research programme is multifaceted. It encompasses qualitative and quantitative analysis, as well as onsite visits to managers’ offices. Identifying managers with an edge is an important part of our process. Our scale also enables Harbour to put segregated mandates in place with some managers we appoint, which allows us to tailor the way the money is managed – for example, taking our responsible investment considerations into account.

The examples in this article demonstrate that competitive advantages come in many forms. Sometimes it is a better decision-making process. Sometimes it is deeper industry expertise, broader research resources, or stronger alignment between analysts and portfolio managers. What matters is that the edge is real, and capable of improving outcomes over the long term.

Although we’d love to see our managers on the podium after every race, the real prize is them winning the championship at the end of the season, and being a contender every year.

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¹ Buyouts are large-scale investments where TPG typically takes a controlling position in private companies, including carve-outs of business units from large corporations.

² Data as at 30 June 2026.

³ Nuveen will commence managing money for Harbour Asset Management Limited in October 2026.

⁴ Data as at 30 June 2026.