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Generation Y
Ed Hetherington, 32
Director of Public Markets, UPS
"I guess it's fun to go to a holiday party and brag about beating the S&P, but why is that impressive if you've taken on unnecessary risk to beat it?" This ethos sums up Hetherington, a rare bird in both employment choice and institutional investing. When the rest of his University of Pennsylvania classmates were stampeding to investment banking and management consulting in the early part of the last decade, Hetherington instead chose to enter corporate America. He initially joined Atlanta-based UPS in its merger and acquisition department, and in 2007 switched to the company's pension management division, where his contrarian nature fitted well once again. "With a $24 billion pool of capital and 90% funding, we do manage to our liabilities as much as we can," he says. "But seeing as we're still accruing liabilities on all our plans, we can't entirely immunize. So, instead, we choose to focus on absolute return in everything we're doing. Our first goal is to not lose money. Our second goal is to meet our target of 8.75%. You can't judge everything off a benchmark anymore." If the S&P is up 30%, Hetherington says, and the UPS fund is up 20% with less risk, they're happy—a bold risk that lesser birds might shy away from for fear of career risk.
Perhaps most interesting, Hetherington is an outlier in one more way. He is, at 32, still a member in an active defined benefit plan. A rare bird indeed.
Generation Y: The title says it all: These are the prodigies of the asset owner universe. Wet behind the ears? Perhaps. Bright-eyed and bushy-tailed? Maybe. But these five are no charlatans, and if they tie themselves to the asset-owning mast as the siren song of hedge fund riches sounds, they will be The Establishment of asset owning circa 2025. Our bold guarantee: At least one of the following young'uns will manage one of the top 10 funds in the world in under 15 years.