New AAAIM Study: AAPI-Owned Investment Firms Consistently Outperform but Manage Just 0.49% of Industry Assets

Data shows AAPI-owned firm underrepresentation costs investors roughly $225.2 billion in forgone returns

NEW YORK--(BUSINESS WIRE)--A new study released by the Association of Asian American Investment Managers (AAAIM) revealed that funds owned by Asian American and Pacific Islanders (AAPI) consistently outperform their non-AAPI peers – but remain underrepresented in capital and headcount. This is the fifth consecutive study from AAAIM and Bella Private Markets (BPM) exploring AAPI manager trends.

Key Findings

• AAPI-owned firms manage just 0.49% of total assets under management despite managing 3.05% of active funds by count.
• AAPI funds are more likely to land in the top quartile of performance (and less likely to land in the bottom quartile) than non-AAPI funds, across every asset class studied. Real estate funds show the widest gap: 42.9% of AAPI-owned real estate funds rank in the top quartile, compared with just 14.3% in the bottom.
• In private markets, AAPI venture capital and buyout funds post higher average returns. AAPI venture capital funds returned a capital-weighted average IRR of 15.4%, versus 9.7% for non-AAPI funds. AAPI buyout funds averaged 19.2%, versus 13.7%.
• AAPI private funds tend to beat public market benchmarks by a wider margin than non-AAPI funds do. Measured against the S&P 500, AAPI venture capital funds returned 1.11 times the index on a capital-weighted basis, while non-AAPI venture funds returned 0.91 times — meaning they underperformed the market.
• AAPI mutual funds deliver better long-term, risk-adjusted returns. At the 10-year mark, AAPI mutual funds outperformed non-AAPI mutual funds by 3.1 percentage points on a capital-weighted basis, and posted higher Sharpe ratios over five- and 10-year periods.
• Investors who skip AAPI funds pay for it. The report estimates that an investor who allocated only to non-AAPI mutual funds from Q1 2015 to Q3 2025 gave up as much as 30.4 percentage points in cumulative returns. For venture capital, the figure rises to 41.4 percentage points. Scaled across the industry, the report estimates AAPI-owned firm underrepresentation cost investors roughly $225.2 billion in forgone returns.

Josh Lerner, Managing Partner at Bella Private Markets and Jacob H. Schiff Professor at Harvard Business School, notes in the study, “Since 2020, the reports that AAAIM has produced in collaboration with BPM have helped highlight the underrepresentation of the AAPI community in finance, especially at the ownership level. Our findings are consistent with previous studies: they highlight strong performance but low representation among AAPI-owned firms across every asset class we study. Insights of this kind can meaningfully inform investment decision-making and have the power to encourage institutions to cast their net more widely in their search for the best performing managers.”

Brenda Chia, AAAIM’s board Co-Chair, comments, “This study is not about representation – it is about performance. Allocators, as fiduciaries, need to pay close attention to these findings. There is clearly an opportunity in the industry for allocators to examine manager pipelines and portfolios to top-performing managers, including AAPI-owned funds. AAAIM also has a duty of care to ensure that the next generation of AAPI investment leaders are being developed and given opportunities.”

The AAAIM and BPM study is based on the largest and most comprehensive dataset AAAIM and BPM have assembled to date: 11,974 U.S.-based private markets firms managing 55,044 funds, and 2,481 mutual fund firms managing 24,888 funds.

To download a copy of this study, please visit www.aaaim.org.

ABOUT AAAIM

The Association of Asian American Investment Managers (AAAIM) is the industry’s leading community of AAPI investors, founders and leaders shaping the future of investment management. For over 20 years, AAAIM has represented the best of the investment community – from leading institutional allocators to bold new emerging managers. As a national 501(c)(3) nonprofit organization, AAAIM is dedicated to elevating AAPI investment management professionals by opening access to opportunities, increasing representation in leadership, and championing the next generation. For more information, visit www.aaaim.org.