While Mellon executives are sticking to their knitting, BGI officials have tweaked their investment process after some of its strategies, particularly enhanced indexing, took a hit. In January, Russ Koesterich, head of investment strategies at BGI, said the firm is adding more industry-specific analysis to its stock-picking process.

The BGI’s Alpha Tilts Fund, an S&P 500 enhanced index strategy, returned 0.84 per cent in the year ended December 31, underperforming the S&P 500 index by 4.66 per cent. Despite the recent bumps for quant managers, investors will benefit in the long run from having a mix of quant and fundamental managers in their roster, said William Atwood, executive director of the US$12 billion Illinois State Board of Investment.

“I think the issues of last year are transient, and, more importantly, they’re behind us,” he said.