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Select Equity Group Review

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This review was produced by SmartAsset based on publicly available information. The named firm and its financial professionals have not reviewed, approved, or endorsed this review and are not responsible for its accuracy. Review content is produced by SmartAsset independently of any business relationships that might exist between SmartAsset and the named firm and its financial professionals, and firms and financial professionals having business relationships with SmartAsset receive no special treatment or consideration in SmartAsset’s reviews. This page contains links to SmartAsset’s financial advisor matching tool, which may or may not match you with the firm mentioned in this review or its financial professionals.

Select Equity Group is a financial advisor firm that manages billions in assets on an entirely discretionary basis. Most of these assets are in private funds, though clients can also have separately managed accounts that mostly use a long-only U.S. equity strategy. The firm's initial focus was U.S. small- to mid-cap companies, which then grew to large-cap companies, international companies and private equity investments. In 2015, the firm launched a private investment arm, called Astor Place Holdings.

Based in New York, Select Equity Group works with many different types of clients, including individuals, charitable organizations, businesses, other investment advisors and more.

Select Equity Group Background

Select Equity Group was founded in 1990 by current chairman and CEO George Loening. The firm has operated as a limited partnership since 2013 after a merger with its affiliate, Select Offshore Advisors, LLC, an investment advisory firm. Select Equity is employee-owned, but Loening is the principal owner.

The firm employs a large staff of advisors, several of whom have earned the chartered financial analyst (CFA) designation.

Select Equity Group Client Types and Minimum Account Sizes

While the vast majority of Select Equity Group's client base is made up of individuals both with and without a high net worth, it also maintains relationships with many other institutional and advisory clients. These include estates, trusts, banks, pooled investment vehicles, investment companies and advisors, pensions and other retirement plans, charitable organizations, government entities, insurance companies, pooled investment vehicles and corporations.

For a separately managed account, you need an initial investment of $250,000 million. To invest in a Select Equity Group private fund, you need to invest at least $100,000 and up to $5 million, depending on the fund.

Services Offered by Select Equity Group

Known for its extensive fieldwork and intensive research, Select Equity solely provides investment management. As noted earlier, it does this mainly through private funds, but does offer its long-only U.S. equity strategy through separately managed accounts. The firm’s 11 investment strategies are:

  • U.S. Long-Only Strategy
  • U.S. Core Strategy
  • Concentrated Opportunistic Long-Only Strategy
  • U.S. Long/Short Strategy
  • International Long/Short Strategy
  • International Long-Only Strategy
  • Private Equity Strategy
  • International Long-Only Large-Cap Strategy
  • Global Long-Only Large-Cap Strategy
  • U.S. Small-Cap Strategy
  • Mobility-Focused Long/Short Strategy

Additionally, the firm acts as a sub-advisor for certain mutual funds.

Select Equity Group Investment Philosophy

Generally speaking, Select Equity Group doesn’t attempt to time the market or predict economic trends. Instead, the firm seeks to identify investments that it believes the market is currently undervaluing. The firm uses fundamental analysis as the backbone of this identification pursuit.

Fundamental analysis involves researching a company’s “fundamentals," which might include examining its financial documents and management history and considering the current macroeconomic environment. The firm stands out for using its own research rather than paying others on Wall Street. Its analysts, it says, look at "value chain analysis, studying suppliers, manufacturers, distributors and customers within a specialized area of the economy across market capitalizations." 

Select Equity Group maintains nine different investment strategies, with perhaps the most prominent being the Small-Mid Capitalization/Long-Only strategy. All of these strategies primarily involve individual equity investments. However, the firm may invest portions of each client portfolio in some sort of cash element, such as money market reserves.

Fees Under Select Equity Group

Select Equity Group charges advisory fees according to a number of different schedules that can vary depending on the type of client, the size of their account and the investment strategy governing their account. For individual clients utilizing the U.S. Long-Only strategy, the firm will usually charge an annual fee of up to 2.00% of their AUM, divided quarterly. Accounts larger than $10 million may arrange to pay a performance-based fee. Private fund clients also pay up to a 2.00% management fee, plus performance compensation.

What to Watch Out For

Select Equity Group has one disclosure on its SEC-filed Form ADV. This is in reference to one of the firm's advisory affiliates.

Select Equity may receive performance-based compensation in relation to certain Private Fund and individual accounts. According to the firm's Form ADV, this may create an incentive for the firm to choose riskier or more speculative investments when managing accounts that have this arrangement, regardless of the risk tolerance of the client. However, the firm is still bound by its fiduciary duty to act in the best interests of clients at all times.

Opening an Account With Select Equity Group

If working with Select Equity Group interests you, there are a few ways to get the ball rolling. You can give the firm’s office a call at (212) 475-8335, or you can make an appointment to come into the New York office. It's located on the northeast corner of Lafayette Street and Great Jones Street, just a few blocks south of Astor Place.

All information is accurate as of the writing of this article.

Investing Tips

  • If you're starting out, you're probably better off with a financial advisor who will customize your portfolio to your financial situation and goals rather than an advisor who primarily manages private funds. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
  • Wondering if you have enough money saved for retirement? Check out SmartAsset's retirement readiness calculator to see if you're on pace, and don't forget to take Social Security payments into account.

How Long $1mm Lasts in Retirement

SmartAsset's interactive map highlights places where $1 million will last the longest in retirement. Zoom between states and the national map to see the top spots in each region. Also, scroll over any city to learn about the cost of living in retirement for that location.

Least
Most
Rank City Housing Expenses Food Expenses Healthcare Expenses Utilities Expenses Transportation Expenses

Methodology We analyzed data on average expenditures for seniors, cost of living and investment returns to determine how many years of retirement a $1 million nest egg would cover in cities across America.

First, we looked at data from the Bureau of Labor Statistics (BLS) on the average annual expenditures of seniors. We then applied cost of living data from the Council for Community and Economic Research to adjust those national average spending levels based on the costs of each expense category (housing, food, healthcare, utilities, transportation and other) in each city. Using this data, SmartAsset calculated the average cost of living for retirees in the largest U.S. cities.

We assumed the $1 million would grow at a real return (interest minus inflation) of 2%. Then, we divided $1 million by the sum of each of those annual numbers to determine how long $1 million would cover retirement expenses in each of the cities in our study. Cities where $1 million lasted the longest ranked the highest in the study.

Sources: Bureau of Labor Statistics (BLS), Council for Community and Economic Research