State Street Global Advisors

State Street Global Advisors
Subsidiary
Industry Financial services
Founded 1978 (1978)
Headquarters Boston, Massachusetts, United States
Products Asset management
Mutual fund
Exchange-traded fund
Sub-Advisory services
AUM Increase $2.8 trillion (2017)
Number of employees
 2500+
Parent State Street Corporation
Website www.ssga.com

State Street Global Advisors (SSGA) is the investment management division of State Street Corporation and the world's third largest asset manager,[1] with nearly $2.8 trillion (USD)[2] in assets under management as of 31 December 2017.

The company services financial clients by creating and managing investment strategies for non-profit foundations, businesses, corporations, associations, governments, educational institutions, and religious organizations. In addition to institutional services, SSGA produces investment vehicles for the retail market in the United States, Europe, Asia, and Australia.[3]

SSGA employs 2500 people in 25 locations (11 of which handle assets) around the world.

History

The asset management division of State Street Bank was founded in 1978[4] in Boston, Massachusetts.

Its first three products were a domestic index fund, an international index fund (based on the MSCI EAFE index), and a short-term investment fund.[5] By 1989 the division had $53 billion (USD) in assets under management.

In 1990 State Street Global Advisors was formed as a separate entity from State Street Bank with the mission of expanding globally:[4] first London, 10 more international locations by 1994,[6], with 15 by 1999.[7]

SSGA invented the investment vehicle known as the exchange-traded fund (ETF) in 1993 with the introduction of the S&P 500 SPDR product (Ticker: NYSE Arca: SPY),[8] which is traded on the American Stock Exchange. SSGA is the number two ETF manager in the world second only to BlackRock.[9]

Assets under management climbed to $161 billion (USD) in 1994 and more than quadrupled to $667 billion by 1999.

As of 2006, one-third of assets under management were from non-US investors.

In 2003, SSGA's Boston office moved to the newly completed State Street Financial Center building at One Lincoln Street.[10]

SSGA launched the first foreign real estate ETF in 2006 (Ticker: NYSE Arca: RWX),[11] which provides investors in the US an easy way to access the international housing and commercial development markets.

In January 2011, SSGA completed its acquisition of Bank of Ireland Asset Management (BIAM). The acquisition was first announced in October 2010 for approximately €57 million. The acquisition enhances SSGA’s range of investment management solutions and expands State Street’s overall presence in Ireland where it has been serving institutional clients for 15 years.[12]

For March 2017, State Street Global Advisors commissioned a statue, Fearless Girl by Kristen Visbal, and located it temporarily in the Financial District, Manhattan, in front of the Wall Street icon Charging Bull. The statue is an advertisement for an index fund which comprises gender diverse companies that have a higher percentage of women among their senior leadership.[13] While some have seen it as an encouragement of women in business, some women criticized the statue as "corporate feminism" that violated their own feminist principles.[14][15][16]

Products and services

SSGA creates customized investment strategies for institutions. SSGA manages the assets for clients by setting up commingled funds (otherwise known as common trust funds).

In addition to institutional products, SSGA has 46 ETF investment products in the US market,[17] as of March 2007. The ETFs track international and domestic indices based on market capitalization, investment style, sector, industry, or commodity. ETF products are also available in other parts of the world such as Belgium, France, Hong Kong, and Singapore under the streetTracks brand.

SSGA has 26 Mutual Fund products divided by investment type:[18] money markets, bonds, equities, and diversified funds of funds (also known as life style funds).

SSGA partners with seven companies in various markets to produce local investment strategies for clients.[19] They are Advanced Investment Partners; Asian Direct Capital Management; GovernanceMetrics International (GMI); Innovest Strategic Value Advisors, Inc.; Rexiter Capital Management Limited; Shott Capital Management, LLC; SSARIS Advisors, LLC; The Tuckerman Group, LLC; and Wilton Asset Management, LLC.

Lawsuits

In October, 2007, several pension funds sued State Street Corp. for the alleged mishandling of several bond funds managed by SSGA.[20]

In 2008, State Street Bank was sued by Trust Co. for Fixed Income Funds Investment.[21] The case was settled in 2010.[22]

In April 2009, a class action suit was filed against State Street, alleging SSGA chose illiquid, leveraged, and risky securities in their short-term, liquid fund products.[23]

In October 2017, SSGA agreed to pay over $5 million in settlement over gender pay discrimination, just 6 months after the installation of the Fearless Girl statue on Wall Street.[24][25]

Notes

  1. ↑ "State Street chief takes aim at the cost of servicing". FT.com (Financial Times). February 4, 2018. ... says activities will move to front office. ... previously chief executive of State Street Global Advisors, the bank's investment arm, which is the world's third-biggest fund manager by assets.
  2. ↑ "Archived copy". Archived from the original on 2007-04-01. Retrieved 2007-03-23.
  3. ↑ Data Analytics for Corporate Debt Markets, Using Data for Investing. 2017. ISBN 1497010616. State Street Global Advisors is the investment management division of State Street ... investment vehicles for the retail market in the United States, Europe, Asia, ...
  4. 1 2 "State Street Global Advisors: Mend It, Don't End It". April 17, 2012. State Street Global Advisors was founded in 1978 as the investment management division of State Street Bank and Trust. The firm was a pioneer in the development of domestic and international index funds. In 1990, it was reorganized as a separately incorporated subsidiary of State Street.
  5. ↑ "History of Innovation | SSGA". www.ssga.com. Retrieved 2018-05-09.
  6. ↑ Brussels, Hong Kong, Toronto, Paris, Sydney, Tokyo, Dubai, San Francisco, Montreal, and Atlanta
  7. ↑ added: Munich, Zürich, Santiago, Singapore, and Chicago
  8. ↑ Jen Ryan. "Spyders Widen Web". TheStreet. Archived from the original on 2009-03-10.
  9. ↑ "ETF League Table As Of Jan. 21, 2014". IndexUniverse.
  10. ↑ Greg Ryan (November 22, 2016). "State Street subleasing chunk of namesake tower in Boston". Boston Business Journal.
  11. ↑ John Spence. "New real-estate ETF is a globe-trotter". MarketWatch.
  12. ↑ "State Street Global Advisors Completes Acquisition of Bank of Ireland Asset Management". Business Wire. 10 January 2011.
  13. ↑ Dutram, Eric (2017-03-27). "The 'Fearless Girl' Statue Isn't a Symbol, It Is an Advertisement". NASDAQ.com. Retrieved 2017-03-28.
  14. ↑ The Sculpture of a “Fearless Girl” on Wall Street Is Fake Corporate Feminism. The bronze statue installed by an advertising firm and a financial firm represents basically everything that’s wrong with our society. Jillian Steinhauer, Hyperallergic, March 10, 2017
  15. ↑ The 'Fearless Girl' statue sums up what's wrong with feminism today. Corporate feminism always ends up betraying women’s struggle for justice. That’s why this Wall Street-funded sculpture will never be a symbol to embrace. Cara Marsh Sheffler. The Guardian. 14 March 2017
  16. ↑ Bovy, Phoebe Maltz (March 14, 2017). "'Fearless Girl' Statue Not The Feminist Icon We Need". The Sisterhood. Retrieved 2017-03-27.
  17. ↑ "State Street Challenging BNY Mellon As Largest Custody Bank". November 16, 2017. As State Street is one of the three largest ETF providers in the world ...
  18. ↑ "SSgA Funds". SEC.gov. The SSgA Funds operates ...
  19. ↑ "State Street Global Advisors: ESG Investing & Stewardship" (PDF). August 23, 2016. Clients include governmental entities, corporations, endowments and ... State Street Global Advisors partners with many of the world's largest, ...
  20. ↑ Appell, Douglas (October 15, 2007). "SSgA defends its 'low-risk' funds". pionline.com.
  21. ↑ "State Street Bank and Trust Co. Fixed Income Funds Investment ERISA Litigation".
  22. ↑ "Administrative Proceeding: State Street Bank and Trust Company" (PDF). U.S. Securities and Exchange Commission. February 4, 2010.
  23. ↑ Williamson, Christine (April 8, 2009). "Class action sought in State Street suit". pionline.com.
  24. ↑ Merelli, Annalisa. "The firm behind "Fearless Girl" will pay $5 million for salary discrimination against women". Quartz. Retrieved 2018-05-09.
  25. ↑ "Firm Behind Fearless Girl Agrees to $5 Million Pay Discrimination Settlement". Fortune. Retrieved 2018-05-09.
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