Virtus Investment Partners Q1 2025: Key Contradictions Unveiled in Tax Strategy, Capital Allocation, and Fee Rates

Strategy for monetizing tax attributes, capital allocation strategy, SMAs growth and strategy, M&A strategy and focus, and fee rates and pricing strategy are the key contradictions discussed in Virtus Investment Partners' latest 2025Q1 earnings call.



Assets Under Management and Market Volatility:
- Virtus Investment Partners reported total assets under management of $167.5 billion at March 31, down sequentially due to market performance volatility and net outflows.
- The decline was mainly due to lower assets under management following market performance volatility and client redemptions.

Investment Performance and Strategic Growth:
- Over 70% of equity strategies outperformed benchmarks, and 74% of equity assets outperformed over a 10-year period.
- This strong investment performance, particularly by quality equity managers, is due to strategic offerings that provide investment performance and downside protection during market volatility.

ETF and Product Development:
- ETF assets reached $3.4 billion, with positive net flows of $0.3 billion, reflecting an organic growth rate of 73% over the past year.
- The growth in ETFs is attributed to new ETF capabilities and increased availability through intermediaries, with several new strategies and products expected to launch soon.

Operational Margins and Expense Management:
- The operating margin (excluding seasonal employment expenses) was 32.7%, with an adjusted earnings per share of $5.73.
- Margin stability was maintained through active expense management, including reducing office space, which will result in additional savings starting in Q3.