Prediction Not checkable as stated
McCusker: Pure institutional, RIA, and retail channels will vanish within 20 years
“I would say, 20 years from now, there's not many purely institutional, or purely RIA, or purely retail players. Everything is blended together, whether it's asset managers, advisors, or the end participants, even.”
Opinion
McCusker: Allocators will negatively view well-capitalized managers taking SBA loans
“For a lot of well-established, well-capitalized managers, that's not an appropriate use of that pool of capital, and In some ways, they're taking from small businesses on Main Street that can really deserve it, and I believe that list is going to be made publi…”
Prediction Held up
McCusker: More Institutional Firms Will Merge With RIA Platforms
“The other thing is this is going to continue to happen. I don't think these are the last two firms that are going to tie up with RIA platforms.”
Prediction Not checkable as stated
McCusker: Markets are more likely to experience a short-term downward snapback
“In the short term, I think it's just Really hard to look at things and say, all right, we're moving forward and markets are going up and we're going to buy more when it feels like the market's gotten a little bit ahead of itself and we're more likely to see a …”
Prediction Not checkable as stated
McCusker: Business Travel Will Return to Normal Quickly Post-Pandemic
“While some are saying this is a breakthrough, and we're going to be a lot more flexible working from home, I think we're going to go back to normal pretty quickly, and we're going to be road warriors once again. So it's actually, I'm not answering the question…”
Disclosure
NEPC is pounding the table to rebalance out of US equities
“We've been talking about over the last year, and US equities have continued to do pretty well, but I think we're really pounding the table now that that's a place where we want to rebalance.”
Disclosure
NEPC lets fund managers decide capacity allocations across clients
“We take that twenty million dollars, put it in a list, and we give that back to the manager, and they make the decision of how they want to allocate, so we're not making the choice of one client over another. We're not choosing OCIO over advisory. They all go …”
Assertion Partly supported
The bottom 50% of the US economy saw no wage growth
“And the bottom 50% of our economy hasn't seen a wage increase in over 50 years.”
Opinion
Investors should avoid passive indexing in emerging markets
“You don't want to be passive in emerging markets. Even if it can be a challenging benchmark to beat, you want to be active there. You want to be trading there and not just stuck with what the benchmark offers you. And we see some skill there, too. We see that …”
Insight
McCusker: RIAs Lack Full Investment Engines Built by Institutional Consultants
“You see the RIA space that is growing, that's going through a different kind of consolidation with all these smaller independent RIAs, but you see this tailwind of new wealth coming in there, RIAs needing a lot of investment help, and these platforms that have…”
Insight
McCusker: Investment consulting is inherently unscalable without hiring more people
“If you have two great consultants with 10 clients each, you get to that 21st client, you've got to add another great person. So since it's not a super scalable business model, it's always somewhat inorganic.”
Opinion
McCusker: Distributing through Hightower's RIA platform provides scalable growth
“If we can bring solutions to Hightower's RIA platform and have them invest in it, that's a more scalable model than we've been able to create historically.”
Disclosure
McCusker: Hightower acquiring 100% of NEPC was a deal-breaker
“A really important part of our culture is having ownership in our business, being really well aligned, and then being able to pass that ownership on to the next generation. So that was a deal killer if they wanted to go 100%.”
Insight
McCusker: Inaccurate acquisition rumors are ideal because they can be cleanly denied
“There was a moment where there was a rumor out there that we were being bought by one of our competitors, which if you're going to have a rumor out there, having it be the wrong rumor is actually ideal because you can deny it and you don't have to give any mor…”
Prediction Open · timeframe Dec 2027
McCusker: TH Lee will face another Hightower transaction in a few years
“Hightower is owned by TH Lee. It's been a very successful investment for them. They've rolled it into a continuation fund. That continuation fund has a life on it, and they'll have to figure out something. There will be another transaction a few years from now…”
Insight
McCusker: Next-gen RIA leaders prefer planning over in-house investment management
“They are under allocated to private markets. There's a generational transfer happening within the RIA leadership where you have folks who led their RIAs from an investment perspective, and the next generation wants to be more planning oriented and wants to han…”
Disclosure
McCusker: NEPC avoided an auction because Hightower terms were fair
“It just felt wrong to bring in other players at that point, and we felt like having the external advisor validate that the financial terms were reasonable and at market just gave us some comfort that we were only going to screw things up if we brought other pe…”
Assertion Not checkable as stated
McCusker: BlackRock's SIO fund runs high tracking error for fixed income
“Within a fixed income allocation, It's a pretty high tracking error strategy when you think about what most fixed income strategies deliver for tracking error.”
Disclosure
McCusker: NEPC 10-year assumptions project 6-7% equity returns versus 0.6% Treasuries
“We just went through a full rerunning of all of our assumptions, and we've got equity assumptions in the sixes, the sevens, even higher for emerging markets, and then a treasury assumption at . Six percent right in line with the yield right now. And you run th…”
Opinion
McCusker: Credit yields are attractive enough to compensate for upcoming defaults
“And that's true for credit as well, where sure, again, just like equities, there could be another leg down, but the yield is pretty attractive and should compensate you fairly well for the default cycle that we're likely to go through.”
Opinion
McCusker: 2020 Vintage May Offer Best PE Opportunities in Years
“This could be some of the best opportunities that come along in years for new private market funds.”
Insight
McCusker: Solve Denominator Effects Through Multi-Year Repacing, Not Sudden Cuts
“You work your way out of it over time through repacing year over year and not by making a dramatic move in one year.”
Prediction Didn’t hold up
McCusker: PE Capital Calls Will Drop by at Least One-Third
“Our expectation is that calls and distribution will both be lower. I think when we analyzed it, calls and distributions were down by a third to half through the global financial crisis, and that's sort of our base case right now that we can expect At least a t…”
Prediction Not checkable as stated
McCusker: Due diligence will stall briefly before surging in distressed credit
“I actually think it'll be slow right now, and right now being the next One to three months, call it. And then I think it's going to ramp up like crazy. One, it'll be a little bit of a backlog. And two, what we were talking about earlier, some of those credit o…”
