Ladies and gentlemen, thank you for standing by. Welcome to BrightSphere Investment Group Earnings Conference Call and Webcast for the Third Quarter 2019. During the call, all participants will be in a listen-only mode. After the presentation, we will conduct question-and-answer session.

[Operator Instructions] Please note this call is being recorded today, November 5th, at 11:30 AM Eastern Time.I would now like to turn the meeting over to Brett Perryman, Head of Investor Relations. Please go ahead, Brett..

Thank you. Good morning. Good morning and welcome to BrightSphere's conference call to discuss our results for the third quarter ended September 30th, 2019.Picking up on slide three of our new investor deck. Before we get started, please note that we may make forward-looking statements about our future business and financial performance.

Each forward-looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those projected.Additional information regarding these factors appears in our SEC filings, including the Form 8-K filed today containing our earnings release and in our 2018 Form 10-K.

Any forward-looking statements that we make on this call are based on assumptions as of today and we undertake no obligation to update them as a result of new information or future events.We will also reference certain non-GAAP financial measures.

Information about any non-GAAP financial measures referenced, including a reconciliation of those measures to GAAP measures, can be found on our website along with the slides that we will use -- we are using as part of today's discussion.Guang Yang, our President and Chief Executive Officer; and Suren Rana, our Chief Financial Officer, will lead the call.And now, I'm pleased to turn the call over to Guang..

Thanks Brett. Good morning everyone and thanks for joining us today. Let me begin on slide five of the presentation by walking through some of the highlights for the third quarter. We reported ENI per share of $0.42 for the third quarter compared to $0.45 for the second quarter.

The $0.03 difference quarter-over-quarter is attributable to higher placement agent fee and equity market depreciation across some non-US regions.Our outflow of $6.2 billion for the quarter were largely concentrated in lower-fee sub-advisory accounts with about $2 billion related to Victory's acquisition of USAA and the related reallocations, and another $2 billion related to continued reallocation from a specific clients in the U.S.

large-cap equity sub-advisory space.Looking forward, with a potent business mix, concentrated in high-growth segments of the industry, we remain confident in our organic AUM and revenue growth prospects particularly as the investor interest remains high across many of our quantitative strategies and our alternative strategies approach the next-vintage fundraising cycle over the next few quarters.Turning to slide six, we have made considerable and the measurable progress in refocusing our business since the beginning of 2019, and returned substantial value to shareholders along the way.

Streamlining our center resources has generated $8 million to $10 million in annual expense savings.As a result, BrightSphere is now a much more nimble and efficient company with entrepreneurial and performance-driven culture.

Our senior management team continues to be aligned with shareholders through a compensation structure focused on out-of-the-money options that keep related costs low and incentivize us to remain focused on creating value for our shareholders.Turning to capital management, our substantial free cash flow combined with the new $450 million credit facility provides us with ample financial flexibility.

This quarter, we increased both the size and lender participation in our new facility, which includes a broad range of leading U.S.

and international financial institutions.We remain prudent with respect to leverage levels and the repaid $35 million of indebtedness in the third quarter, bringing our net debt to adjusted EBITDA level to 1.6 -- 1.8 times.Also, we repurchased 16.6 million shares this year through the end of the third quarter, with additional 2.7 million shares bought back thus far in the fourth quarter.

We have spent approximately $250 million to-date to share repurchase, generating earnings accretion of 13%.Going forward, we will remain a balanced capital management approach focused on growth investments, which I will discuss in a moment, as well as opportunistic share repurchases as appropriate.Our growth strategy is outlined on slide seven is and has four main components.

The first is to leverage our high-growth business mix, which provides broad participation in attractive in-demand segments of the industry.

We have simplified our financial reporting to align with how we think about our firm, our differentiation and our growth prospects.We believe this approach will further increase the transparency of our business model and better illustrates the underlying progress across our quant/solutions, alternatives and the liquid alpha segments.

A key differentiating factor for BrightSphere in our organic growth outlook is that 66% of our management fee revenue is derived from the quant/solutions and alternative segments, nicely aligning with secular demand trends.Second, we are focused on expanding our capabilities in high demand higher-fee areas.

Seed and co-investments remain key levers to diversify our Affiliates business and provides greater stability our across the franchise, while also positioning us to participate more broadly in high growth, higher fee segments of the industry.

Seed products building momentum, including quant/solutions, single factor, multi-asset class and China A shares strategies, as well as the liquid alpha, emerging markets, equity and leveraged loan capabilities.These and other basic seeded products are expected to generate upwards of $3 billion in gross inflow in 2019 and into early 2020.

We continue to innovate alongside our Affiliates and have several alternative strategies currently in development as well.In addition to working with individual Affiliates, I'm excited to share that we are working with the Mercer to develop a series of customized investment solutions to address the long-term return investment needs of institutional investors worldwide.These bespoke strategies would bring together BrightSphere's highly regarded suite of investment capabilities, with Mercer's industry-leading OCIO expertise to provide attractively priced open architecture investment framework.Early reaction among select global clients have been very positive and we're optimistic about the potential for this new alliance.Our business model provides a unique advantage in offering this type of products as we can bring together the independent investment process and philosophy of seven distinct highly specialized firms into a single point of access for investors.Moving on, we are actively engaged in cultivating relationships with a range of high quality teams, platforms and businesses with complementary investments capabilities, including liquid alternative, credit and infrastructure.We have entered into late-stage discussions with several attractive businesses and are pleased with our progress to date.

As with all elements of our business, we will continue to maintain a strict return discipline in evaluating all potential transactions.Third, we remain focused on increasingly penetrating growing markets in key areas of the world.

Our global team has established multilevel relationships with many of the world's largest banks, sovereign wealth funds and family offices in markets such as China, Latin America, Europe, and the Middle East.In addition, this quarter we expanded our US coverage to include the insurance general account segments.

More and more insurance companies are looking to outsource their investment needs to high-performing specialists like our affiliates.Finally, in everything we do, we remain focused on creating value for our shareholders.

Our strong recurring free cash flow from operations supplemented by prudent levels of leverage provides financial flexibility to fund our growth initiatives and opportunistic share repurchases. And we have infused the organization with a rigorous expense discipline that is focused on reallocating resources to maximize growth.Thank you once again.

And now, let me turn the call over to Suren to discuss our results in greater detail.

Suren?.

Thanks Guang. Turning to the slide nine, we provide an overview of our three segments, which we believe best reflect the three distinct parts of our business.

This enhanced segment disclosure will provide investors more transparency on our differentiated business mix and better identify the growth drivers going forward.It also allows investors to see the progress across each of our key business line at a more detailed level.

As an aside, and in case you're wondering, we will continue to provide asset class level AUM disclosure that we have provided historically and you will see it in the 10-Q.So, turning back to the segments.

The quant/solutions segment shown on the left hand side on the slide includes strategies where we are leveraging highly sophisticated proprietary technology to process vast amount of data to deliver strategies and solutions to our clients that are tailored to achieve their specific risk and return objectives.

For example, our affiliate Acadian has consistently invested in its technology for decades to allow them to isolate and deploy a multitude of factors across asset classes, geographies and currencies that can best produce the outcomes sought by the clients.We see strong secular tailwinds supporting the segment as clients are increasingly seeking differentiated capability.

This segment should also benefit as clients continue to ask for highly customized solutions for their target outcomes, instead of pre-packaged offerings.

The strategies in the segment such as low volatility, multi-asset class, multi-alpha single factor, multi-asset income are all highly scalable and provide tens of billions of dollars of capacity to meet the growing global demand.Our alternatives segment in the middle column primarily comprises private market strategies like private equity, real estate and real assets such as forestry.

Most of our revenue in this segment comes from stable management fees from long-term committed capital and non-performance fee.These strategies continue to enjoy strong demand from institutional investors, which we believe will drive meaningful organic growth for us going forward, particularly as several of our strategies approach their next-vintage fundraising cycles over the next few quarters, which will grow our AUM in the segment between 2020 and 2022.

By way of reference, we raised approximately $12.5 billion in our alternative strategies in 2016 to 2018 fundraising cycle.The liquid alpha segment, on the right most column, enclose a diverse mix of fundamental long-only public security investment across a range of asset classes, geographies and capitalization ranges.In this segment, we have proven track record of outperformance across market cycles over long periods of time.

While we have seen elevated outflows in this segment from low-fee U.S. equity, sub-advisory area, we continue to develop and seed higher fee higher margin strategies such as emerging markets, global equity and leveraged loans.As a result, our margins in the segment continue to be healthy.

So, looking at our three segments and the fact that quant/solutions and alternatives segments that together comprise two-thirds of our revenue are enjoying strong secular tailwinds, and our liquid alpha segment nicely complements our overall business.It positions the company very well to produce strong organic growth.

We would expect quant/solutions and alternatives segments to account for more than 80% of our business in the coming years and generate strong revenue and earnings growth for the company as a whole.We also continue to seed and are also open to acquiring new in-demand strategies particularly in those two segments, which we expect to generate additional growth on top of our current positioning.

And we're taking these in-demand strategies to new geographies such as Asia and new channels such as insurance as Guang earlier mentioned.So, this diversified business mix and our suite 100-plus strategies across these three segments, enables us to offer to our clients comprehensive product like total solutions that Guang mentioned and these kind of products show the true power of our multi-affiliate model.And also this diversified business mix produces very strong cash flow, which we can continue to use to repurchase our shares and generate additional EPS growth.

So to summarize on this slide, our comprehensive and differentiated business mix is well positioned to produce organic growth and we continue to invest in new product in these two areas, which we expect to generate additional growth.Now, turning to each of the segments individually.

On slide 10, we show the results for the quarter from our quant/solutions segment.

This segment continues to generate positive flows, given the trends favoring differentiated strategies and solutions that I touched on earlier.And while there could be inter-quarter movements from time to time, this segment should continue to generate strong long-term organic growth.

The adjusted EBITDA in the segment remained consistent as last quarter at $35.9 million, and the drop in EBITDA compared to year-ago quarter was driven by 4Q18 market decline.Turning to the alternatives segment on the next slide, slide 11.

This segment has produced strong growth for us, generating $12.5 billion of high fee flows between 2016 and 2018 that I touched on earlier.

So coming off of that strong AUM growth, 2019 has been primarily focused on deployment of capital.And as I mentioned earlier, we would expect to get back to growing our AUM in this segment between 2020 and 2022 as multiple strategies are nearing their next-vintage fund raisers.

And our track record continues to be very strong.As you will note from the pie chart on the left, most of our AUM in this business is invested in private market strategies, in private equity, real estate, and real assets.

Relatedly, the pie chart on the right shows that most of our AUM in this segment comes from long-term capital either in commingled funds or separate accounts.

Additionally, 90% to 95% of our revenue in this segment comes from management fees and non-performance fees.The adjusted EBITDA for the segment came down from $12.1 million last quarter to $8.8 million, primarily due to the timing of the outsized placement agent fee that Guang mentioned earlier.And the revenue and EBITDA versus a year-ago quarter are lower due to absence of catch-up fees.

As we have mentioned in the past, the funds raised in 2018 generated catch-up fees accruing from the time of first closings of those vintages, which were in 2016 and 2017.This year, we do not have any catch-up fees as we completed the fundraising of those vintages in 2018.

Having said that, this dynamic will reverse in 2022 -- between 2020 and 2022, when we start fundraising with new vintages.Turning to our third segment, liquid alpha segment on slide 12.

This segment has generated and maintained a strong long-term investment performance for clients over long time periods through high quality team and disciplined investment processes.As we touched on earlier, we saw elevated flows this quarter of $6.8 billion, of which approximately $2 billion was related to Victory's acquisition of USAA and $2 billion was from continued reallocation by a specific sub-advisory client in the U.S.

large-cap strategy. While the Victory-USAA transaction was episodic and one-time, we do expect to see more outflows from the client in U.S. large-cap strategy for next several quarters.So, while the latter issue was not one-time, it is a finite issue, given that it's only one client.

And having said all that, these outflows are generally as we have mentioned from low-fee strategies and we continue to see inflows in higher fee strategies.

As a result of this diversification into high-fee strategies and continued expense discipline, our margins in this segment continue to be very healthy.Moving to slide 13, where we compare our key metrics for Q3 2019 to prior quarters, on a consolidated basis.

I want to call out on this slide, our weighted average fee rate on the bottom left-hand side, which decreased from 37.5 bps in Q2 2019 to 35.9 bps this quarter.This decrease was mainly driven by market depreciation in higher fee asset classes such as emerging markets equities along with the increase in placement agent fees that we touched on earlier, which directly reduced the management fee as a contra item against revenue.

These two factors primarily led to the decline in our EPS from $0.45 to $0.42.The next slide, slide 14, shows our net client cash flows and revenue impact of flows by segment.

The chart on the left-hand side shows the net flows for our quant/solutions segment, and alternatives segment have generally been positive with negative net flows concentrated in the liquid alpha segment.For this quarter, quant/solutions and alternatives segment had $0.6 billion of positive net flows, while liquid alpha segment had $6.8 billion of negative net outflows -- net flows.Total net client cash flows was negative $6.2 billion.

Our gross sales declined slightly quarter-over-quarter from $5.1 billion to $4.6 billion, while the growth outflows weakened from $7.8 billion to $12.1 billion, which included the $2 billion we mentioned from Victory's acquisition of USAA and the $2 billion from the sub-advisory clients.Inflows were at 34 bps, while outflows were 30 bps, again highlighting the concentration of outflows in lower fee products and our continued migration toward higher fee strategies.Please note on this page that our NCCF and revenue impact of NCCF now includes income and distributions reinvested by clients and excludes realizations to more accurately reflect sources of recurring flows and to provide more granularity on our flows.Now, I also point your attention to slides 23 and 24 in the appendix, where we do provide additional granularity on our key segments.

Note that the other column here primarily reflects our headquarter expenses and corporate-level items such as interests and taxes.Now, I'd like to turn the call back to the operator and we're happy to answer any questions you may have..

[Operator Instructions]Your first question comes from the line of Craig Siegenthaler from Credit Suisse. Your line is open..

Hey, good morning, Yang..

Good morning..

Coming back to the commentary you guys had on acquisitions, how do you think about buying an in-demand business in quant or alternatives, but if the valuation is much higher than your current five times P/E multiple?.

Yes. Hi, Craig. Look, as we've said, everything we do, we -- there is an intense focus on EPS and the return on the capital.

So, any acquisitions, or seeding any new strategy, we compare all of those things to what we can get from repurchasing our own stock.And thankfully, it is a high bar because as you know, repurchasing our own stock at six to seven times P/E is highly accretive, and we've noted that and have repurchased every quarter, a meaningful amount.

So, we -- essentially, that's how we look at M&A, even though we are looking at in-demand strategies.While it may not be comparing to repurchase on the same quarter right off the bat, we look at the overall level. It has to be more accretive than repurchases for us to do something on the acquisition side..

Craig, let me just add to that. The teams we're talking to, they are happier with our model. So, it's not necessarily just the price or the valuation is the only consideration.

And our model allow them to continue to have an ownership in their firm, the founding or even keep their name, but more importantly, we will be able to help them to grow globally and we can provide say capital.So, for us, it's really looking at some of those in-demand strategies and how can join forces together to grow the pie bigger rather than just outright acquisition of 100% of the interest..

Got it. Yes. And in the quarter, it's great to see all the buyback activity just taking advantage of the stock at these depressed valuations. My second question is, as I look toward next year, 2020 and I think about the very large illiquid-alt fundraising potential that could be coming and I know you size the last one, I think was $12.5 billion.

How do you think about timing when this could start, how long this could go on, how long could we see chunky high-fee inflows continue for?.

Yes, hi Craig, this is Suren. Yes, so as you would have seen in the last fundraising cycle that lasted two and a half years, from back half of 2016 to end of 2018.

On the alternatives side, fundraisers can be episodic.They are not smooth every quarter, but essentially over time, we would -- we are looking at it much more from a multi-year perspective as opposed to a specific quarter. But I did provide the reference point of how much we did last cycle and that's useful to note..

Got it. Thanks for taking my questions..

Your next question comes from the line of Kenneth Lee from RBC Capital Markets. Please go ahead, your line is open..

Hi, thanks for taking my question. Just want to see if you could just further expand upon the opportunity for developing the customized investment solutions with Mercer, wonder if you could give a little bit more detail as to what types of clients you're aiming for and perhaps give us an idea of how the economics would work for BrightSphere. Thanks..

Thanks Ken. If you look at our business model, we have seven highly respected Affiliates offering independent investment process and philosophy. At BrightSphere, we can provide those strategies with a single point of access for some of the large clients.So, we're really talking about some of the biggest institutions globally.

And in terms of working with Mercer as you know, Mercer is really a leader in asset allocation and portfolio construction. So, the early feedback from a group of select global institutional investors has been very strong. So, we're very optimistic about the potential for the offering..

Got you. And then just one follow-up if I can and it's great that you broke out the different categories between the liquid alpha, the alternatives and the quant/solutions.

But just looking at the operating margin within the liquid alpha specifically, they look pretty high, 48%, within that range.Wondering if you could just give a little bit more insight into the dynamics there.

Maybe just tell us why it's so much higher than some of the other categories and whether it has some to do with just the whole dynamic with the sub-advisory mandates. Thanks..

Yes Ken. Essentially the margins that we see, there are many things that go into it, one of which is also the minority interest held by the members of the management team collectively.

So, it's not necessarily indicative if you will, of the underlying profitability, but net-net, yes, we do get high margins in that business.We do benefit from teams that have managed money for the clients, for long periods of time, and can manage more and more capacity.

They -- as I touched on earlier, they have also -- generally most teams have been very disciplined on expenses.And we are migrating toward higher fee strategies and the outflows are coming from lower fee strategies. So, it's a combination of all of the above, if you will.

And so we do expect -- we do focus on margins a fair bit and we do try to proactively continue to maintain them..

Very helpful, thank you very much..

Your next question comes from the line of Chris Harris from Wells Fargo. Please go ahead, your line is open..

Thank you. So, it seems like we're getting closer to getting a trade deal signed with China, at least Phase 1 of the trade deal. So, I'm wondering if that does occur, does that potentially open things up for you guys over there.

Or do we have to wait until Phase 3 happens before that region becomes a realistic growth driver for you guys?.

Thanks Chris. Yes, we hope there would be some meaningful milestone for us, once the Phase 1 is reached. We have very focused on there. We have had many meetings at very high level, as well as at working level.

So, the trade negotiation itself kind of changed the phase of our progress there, but we were very involved there.But the way we look at China is really long-term. It's going to be a very big market, it's going to be a long-term commitment.

Of course, we would like to share some progress near-term, but I think the key is really focus on long-term there..

Okay. In terms of your fee rate this quarter, we know it's impacted by the item that you guys called out.

Should we be modeling for expecting a pretty substantial recovery in the fourth quarter? So, in other words, $5 million to $6 million uplift in the management fee run rate or is that not necessarily the case?.

Yes. And as we -- as we mentioned that one item that we called out on the footnote on page 11, sizing the placement agent fee item, which we would expect to normalize, the item. It was -- prior quarter it was $1 million.

So, the delta.And the mix issue always is an impact on fee rate, which is hard to quantify, essentially the mix between our higher fee emerging market strategies and lower fee strategies that would be another thing that impacts fee rate and that's the harder one..

Okay. Thank you..

Your next question comes from the line of Michael Cyprys from Morgan Stanley. Please go ahead, your line is open..

Hey, good morning. Thanks for taking the question. Maybe just on capital management.

You guys have been pretty aggressive on the buyback front, I think you guys had mentioned 16.5 million or so shares repurchased year-to-date, roughly like 16% of share count.I guess if we just look at the share price, it doesn't seem to be having the reward in the marketplace, the intended -- perhaps intent that you guys are looking for.

I guess, at what point do you get to realization that maybe it's not working out as well as you guys would have intended and maybe lead to a change in thinking around capital management and perhaps maybe a refocus on the dividend? And maybe you could just update us your thoughts on the dividend policy and how you're thinking about that?.

Yes, certainly, Michael. As we look at our business and our growth strategy, we feel fortunate that there are a number of levers from the status quo business perspective, but also from a capital deployment perspective that can produce earnings growth and EPS accretion for us, right.

And we touched on the seeding new products, acquiring new products, repurchasing shares, and thankfully, there are good opportunities across all of those areas.We do compare all of these items, as I said earlier, with each other so that the capital is going to the best uses, rather than rationing capital for across each of the -- each of the items.And so we would say is that we will continue to maintain that discipline across these initiatives that whenever the highest return opportunities present themselves, we would execute on them in the past few quarters.

It has been repurchases and that continues to be attractive. So, we will keep that in mind.From a dividend perspective, it just looking at all these opportunities, it is much more accretive and -- both on earnings as well as value accretion perspective to our company and to the shareholders to deploy the capital on those fronts, and not dividends..

And then just maybe a follow-up on the inorganic growth. I think you had mentioned you're in late-stage discussions with maybe several attractive businesses.

Are these more teams, or are they firms? Just if you can provide any sort of color on how you're thinking about adding new relationships at BrightSphere.If you could just remind us on how much capacity you have today, firepower for acquisitions.

I think the cash balance is maybe $116.5 million, is that all potentially available for deployment? And then also if you can remind us on the leverage capacity as well..

Yes, what we can say is, they are very highly regarded businesses, not just teams, but the business where the founders who would like to team up with a large institution like us to really for the next phase of growth particularly globally, they can leverage our global distribution and they can -- we can provide with seed capital.

That type of opportunities we're really focused on right now..

And then Michael, on the capital question, I would say that the way we think about our capital is really that in terms of repurchases, we would generally think about limiting that to our free cash flow after dividends.

So, that's the distinct pool of capital, if you will, that we wouldn't really -- we don't really look at leveraged repurchases.But we -- in terms of acquisitions, we do have cash on hand and then we have our revolver, which we increased to $450 million from the prior $350 million.

So, we do have firepower available if opportunities become -- if some of the opportunities reach finish line..

How much is that in aggregate? It sounds like it's the $450 million from the debt, if I heard you.

And then is it the entirety of the cash line or is it a portion of that? I guess, how much is at the parent versus the Affiliates?.

Well, of the $450 million, we do have the revolver. We do have some withdrawn. So, we have about $275 million available on our revolver that's yet to be withdrawn. We have cash on hand and we also have an upsize feature on our revolver of $150 million.

And so we do have the size essentially available to go really up and down the spectrum.We are generally looking at it, as Guang mentioned, teams -- ambitious teams that really want to grow their businesses much beyond what they could stand-alone.

Some of them are earlier stage, some of them are more developed, but none of them are generally outside the ranges we just discussed in terms of capital deployment..

Okay, thank you..

Your next question comes from the line of Robert Lee from KBW. Please go ahead, your line is open..

Great. Thanks, good afternoon. Thanks for taking my questions.

And I apologize if maybe you covered this earlier, I got on a little bit late, but could you update us on some of your global distribution initiatives?Maybe give us a sense, if we look at kind of new sales, how that's -- how that's contributing to sourcing of assets? And maybe update us on some of the investments you're making or have made in -- on the global distribution side, excuse me..

Sure, Robert. We have added resources in Latin America, Middle East, and Asia. Particularly in Asia, we have added quite a few experienced professionals. And they are working really try to introduce BrightSphere and our Affiliates to some of those large institutions there.

So, we are very optimistic this relationship will come through and not only at a high level with those institutions, but also as a working level.And all I can say is that their working level are fully engaged with us. So, we cannot really pin down exactly when those mandates will come through.

But I think again the focus for us is really try to contemplate long-term relationships with those institutions across different products not just one product..

Well, maybe as a corollary to this and outside of the alternatives business, is it possible to get a sense on in the aggregate pipeline, so to speak, across the franchise, I mean, is there a possibility to -- it'd be great if there is a way to quantify it, but at least give us color on kind of the RFP activity starting to pick up, just any kind of color around the health and shape of the pipeline would be great..

Hi Robert. We do have a very strong pipeline, as we mentioned earlier, on our alternatives strategies, we have a very good strong track record.

So, we would expect a lot of clients coming back and gain some new clients across those strategies in our quant/solutions segment as well.We have a very healthy pipeline with clients interested in different strategies for different reasons. There is good pipeline of clients for our low volatility strategy for example.

There are clients interested in multi-asset class and single factor. There are also some clients interested in China A shares strategy, global equity is another strategy and we're still seeing some pipeline pick up for emerging markets equity.

So, I'm just giving you a flavor that it's basically, it's a very diversified set of strategies that is seeing demand from clients.And in terms of being that these are all the institutional mandates with the long gestation cycles and it's hard to really pinpoint which quarter -- which specific quarter something would materialize, that's why we're not able to provide specific, if you will, specific pipeline to the at more granular, but we are very pleased with our -- with the health of our overall pipeline..

Great. Thanks for taking my question..

Your next question comes from the line of Chris Harris from Wells Fargo. Your line is open. Please go ahead..

So, I know it's not showing up in the flows yet, but I wanted to ask you guys if you're seeing really any signs that investors are starting to have increased interest in the value investing style, because obviously a turn in that would be a pretty big deal for you?.

Yes, we do see -- Chris, we do see green shoots investors inquiring about value. And there are some searches about value.

I would say that there is also -- sometimes it's also one step forward and two step back.So, it does change around, but it definitely has been the longest period of time where value has underperformed growth and a lot of clients basically would expect the value to come back anytime now essentially.

So, it's really hard to pinpoint specific timing of when a trickle becomes a stream..

Okay. Thank you..

This concludes our question-and-answer session. I'd like to turn the conference back over to Guang Yang..

Thank you all again for joining us today..