Masters in Business: Embracing Global Opportunities with Jeffrey Becker of Jennison Associates
Podcast Information:
- Title: Masters in Business
- Host: Bloomberg Radio's Barry Ritholtz
- Episode: Embracing Global Opportunities with Jeffrey Becker of Jennison Associates
- Release Date: April 24, 2025
Introduction
In the April 24, 2025 episode of Masters in Business, Bloomberg Radio host Barry Ritholtz engages in a comprehensive conversation with Jeffrey Becker, Chairman and CEO of Jennison Associates. With Jennison managing over $200 billion in assets, Becker brings a wealth of experience from his diverse career spanning firms like Arthur Andersen, Aetna, Altus, ING, and Voya. This discussion delves into Becker's unique perspectives on investment management, global opportunities, and the strategic direction of Jennison Associates within the PJUM family.
Career Journey and Leadership Development
Becker begins by outlining his academic background, earning a Bachelor's in Economics from Colgate and an MBA in Finance from NYU Stern. Contrary to what one might expect, Becker shares, “[...] I had no idea what I wanted to do in college or coming out of college. I was a liberal arts major” (03:01). His early career at Arthur Andersen provided a solid foundation in valuation services, which later transitioned into significant roles at Aetna, where he navigated the challenges of commercial real estate during the post-Recession era of the late '80s and early '90s.
A pivotal moment in Becker's career occurred during the 2008 financial crisis when ING acquired Aetna's financial businesses. This led to his appointment as CEO of ING Investment Management, later rebranded as Voya. Becker recounts a dramatic phone call on a Sunday while coaching his son's hockey team, which led to his unexpected promotion (07:45). This transition showcased his adaptability and leadership under pressure, ultimately setting the stage for his current role at Jennison Associates.
Transition to Jennison Associates and PJUM Integration
After two decades with ING/Voya, Becker sought a new challenge, aiming to return to a more independent asset management environment. He was drawn to Jennison Associates due to its esteemed reputation, strong client roster, and the appealing multi-boutique model under the PJUM umbrella. Becker highlights the advantages of this structure: “for this stage of the asset management industry a multi boutique model is a good model. You get the asset class specialization, you get the entrepreneurialism in the boutique, but you get the benefit of being part of a larger manager that has access to wealth management platforms, capital, global distribution” (19:18).
At Jennison, Becker appreciates the firm's long-standing tradition as one of the first independent institutional asset managers, founded in 1969. He pays tribute to Sigalis, an iconic investor at Jennison, whose philosophy—“do what's right for clients and that'll always be right for the business”—has profoundly influenced Becker’s approach (21:42).
Investment Philosophy: Growth and Value Investing
Jennison Associates prides itself on its growth-oriented investment strategies, focusing on high-conviction, research-driven active management. Becker explains that growth investing at Jennison is centered around identifying “innovative and disruptive businesses driving structural shifts in industries” with significant barriers to entry and secular demand trends (24:16). This approach has positioned Jennison as a premier alpha generator for institutional clients.
On the value side, Jennison employs an intrinsic value approach, targeting companies with temporarily depressed earnings rather than deep value or fallen angels. Becker notes, “value investing [...] is still good companies and good growth in value. I don't think investors really think about growth versus value investing like they used to” (42:46). This balanced focus allows Jennison to navigate different market conditions effectively.
Concentrated Portfolios and Deep Conviction
A key aspect of Jennison’s strategy is maintaining concentrated portfolios, typically holding between 10 to 50 stocks depending on the portfolio size. Becker elaborates, “for our core franchise of growth portfolios, we have 10 stock portfolios, we have 20 stock portfolios” (26:11). This concentration is driven by deep conviction, stemming from extensive fundamental research conducted by their dedicated teams. With a robust team of 70 investment professionals, Jennison ensures that each portfolio is built on meticulous analysis and a clear understanding of each investment’s potential.
Global Opportunities and International Investing
While the majority of Jennison’s assets are US-focused, Becker emphasizes the importance of international and global portfolios, managing around $25 billion dedicated to these areas within a total equity asset base of $150 billion (29:07). He observes, “the international markets might have some legs” given recent policy shifts and economic recoveries in regions like Asia and Europe. Becker asserts that Jennison approaches international investing with the same rigorous, bottom-up company analysis as their domestic strategies, seeking alpha without regional bias.
Risk Management and Unintended Risks
Managing risk in concentrated, high-conviction portfolios is paramount for Jennison. Becker discusses the concept of “unintended risk,” emphasizing that all risks should stem from deliberate stock selection rather than unintended sector, geographic, or factor exposures (32:44). Jennison employs comprehensive risk management reports to ensure that their portfolios remain aligned with their investment strategies, safeguarding against volatility while maintaining the potential for high returns.
Navigating the Parent Company Structure: PJUM and Multi-Boutique Model
Jennison operates within the PJUM (Prudential Financial’s PGIM) family, benefiting from a multi-boutique structure that allows each affiliate to specialize without overlapping. Becker explains, “the multi manager model at PGIM is each of the affiliates, as we call them, versus boutiques are free to pursue their asset class and their specialty in their own way” (34:08). This independence fosters innovation and expertise, enabling Jennison to maintain its distinct investment approach while leveraging the broader platform’s resources.
Market Environment: Managing Volatility and Inflation
Discussing the current economic landscape, Becker acknowledges the heightened volatility and persistent inflation challenges. He emphasizes Jennison’s focus on fundamentals, striving to “filter out the noise” and remain attentive to how macroeconomic shifts affect their portfolio companies (40:32). When fundamentals are impacted by economic changes, Jennison responds by adjusting sector and geographic exposures rather than resorting to cash or bonds, maintaining a fully invested stance to capitalize on identified opportunities.
Growth vs. Value Investing in a Shifting Market
Becker addresses the ongoing debate of growth versus value investing, noting that while growth strategies have outperformed traditionally for over a decade, Jennison continues to excel in both domains. He points out that market conditions now may favor opportunistic intrinsic value approaches, especially as volatility provides entry points for undervalued companies (42:46). This dual capability allows Jennison to adapt and thrive across different market cycles.
Integration within PJUM and Branding Challenges
Operating under the PJUM umbrella introduces complexities in branding and product structuring. Becker discusses how Jennison navigates these challenges by maintaining distinct brand identities for its various strategies while collaborating seamlessly with other PJUM affiliates. For instance, when offering growth funds through broader platforms, Jennison’s offerings are branded accordingly, such as the “PGIM Jennison Growth Fund” (37:02).
Mentorship, Leadership, and Personal Development
Becker attributes much of his leadership style to mentors and his mother's influence, highlighting the importance of values and work ethic. He mentions several key figures who shaped his career, including John Kim, Scott Fox, Bob Crispin, Rob Leary, and Alon Kara-Oglund (54:43). His admiration for Sigalis, a long-standing Jennison leader, underscores the firm's culture of excellence and client-centric values.
Advice for Aspiring Professionals
For recent graduates seeking careers in finance and investment, Becker offers pragmatic advice: “[...] build a resume of skills, not a resume of jobs. Try to develop as many skills as you can along the way and ask questions early and often” (57:26). He emphasizes taking ownership of one’s career, seeking mentorship, and proactively gaining diverse experiences to navigate the multifaceted world of finance effectively.
Personal Interests and Continuous Learning
Beyond his professional life, Becker enjoys immersing himself in historical documentaries, particularly those by Ken Burns, reflecting his passion for history and continuous learning. Currently, he is delving into documentaries on figures like Benjamin Franklin and exploring series such as Yellowstone (53:44). This pursuit of knowledge mirrors his approach to investment—meticulous, informed, and ever-evolving.
Concluding Insights
Jeffrey Becker's tenure at Jennison Associates exemplifies a blend of deep expertise, strategic foresight, and unwavering commitment to client success. His stewardship reinforces Jennison's position as a leader in growth and value investing, adeptly navigating global opportunities and market volatilities. For listeners seeking to understand the intricacies of high-conviction investment management within a global framework, Becker's insights offer invaluable guidance.
Notable Quotes:
- “[...] I had no idea what I wanted to do in college or coming out of college. I was a liberal arts major” (03:01).
- “Do what's right for clients and that'll always be right for the business” (21:42).
- “We're building portfolios, bottoms up, company by company, and looking for what we view are the best companies for our strategy” (29:07).
- “Our portfolios do tend to be more volatile than the benchmark” (31:23).
- “Being invested is key. When people try to time the markets and exit, they've always regretted that” (52:58).
About the Hosts and Production Team
Barry Ritholtz concludes the episode by promoting his book How Not to Invest: The Ideas, Numbers, and Behaviors that Destroy Wealth and How to Avoid Them and acknowledging his production team, including audio engineer Steve Gonzales, producer Anna Luke, researcher Sean Russo, and Sage Bauman, head of podcasts at Bloomberg.
Listen to More Episodes
If you found this conversation insightful, explore over 550 episodes of Masters in Business available on platforms like iTunes, Spotify, YouTube, and Bloomberg. Each episode features in-depth discussions with industry leaders shaping the future of markets, investing, and business.
This summary is based on the transcript provided and aims to capture the essence of the conversation between Barry Ritholtz and Jeffrey Becker.