Oct 30, 2026 earnings call — Record equity AUM and money market developments
Record equity assets under management reached $110.5 billion, with MDT strategies delivering $6 billion gross and $3.2 billion net sales in the quarter.
Revenue $0.5B (est $0.5B) · EPS $1.50 (est $1.43)
Key quotes
"MDT equity and market-neutral strategies had a record $6 billion in gross sales and $3.2 billion in net sales in the third quarter."
"Total money market assets decreased by $27 billion or 4% from the second quarter as funds decreased by $13.6 billion or 3% and separate accounts decreased by about $13.4 billion or 8%."
"We are working with Prometheum, a market infrastructure provider for crypto assets, to expand the reach of tokenized securities through their SEC-registered, FINRA-member broker-dealer market infrastructure."
Analyst Q&A 4
Money fund flows and expenses
Q (Patrick Davitt · Autonomous): Why did your money funds lag big competitors in 3Q and is there more fee competition? Also, how sustainable are your expense controls into Q4 and any early view on 2027?
A: Management said short-term flow moves are routine and driven by others changing fees or portfolio construction. They explained they keep money funds focused on daily liquidity and did not extend maturities to chase yield, and noted they lagged the market after the FOMC move but have caught up with assets up $3.7 billion as of October 28. On expenses, they said margins are over 30%, expect compensation to rise in Q4 as they grow, continue spending on systems and communications, and see no big changes next quarter.
"So Patrick, as you know, we manage our money funds with a bias to daily liquidity at par." — Deborah Cunningham
SMA gains and tokenization plans
Q (Robin Holby · TD Cowen): What drove the SMA inflows in equity and fixed income? And does the Prometheum deal speed tokenizing other funds like MDT?
A: They said SMA success came from consistent, long-term sales effort and strong track records across distribution — no single magic change. On tokenization, they said this deal does not accelerate anything; clients are not demanding these products now and the work is about building infrastructure and preparing for future opportunities while focusing on liquidity.
"As I've said to this audience before, the clients aren't beating down the doors to get these products." — John Donahue
Revenue capture and tax-aware strategies
Q (Y. Cho · JPMorgan): How does revenue capture share compare to AUM share in money funds, and are you considering tax-aware long-short products for MDT given demand?
A: They said they do not have reliable data on market share of revenue and must infer it; pricing varies across institutional and intermediary channels and institutional products often have lower fee rates, while retail-intermediary assets tend to boost blended fee rates. On tax-aware products, they said they are working with firms on those ideas but could not share details, and they noted MDT already has long-short (market-neutral) strategies that have performed well and attracted inflows.
"So you're touching on something that we don't have great information on, which is market share of revenue." — John Donahue
Institutional pipeline and fixed-income demand
Q (John Dunn · Evercore): Can you detail the institutional pipeline: client concentrations, funding timing, impact on fee rates, and any big redemption risks? Also, where will fixed-income demand go and which products will be sought?
A: They said the firm has a $6.5 billion pipeline and expects the equity portion to fund over the next 2 quarters from several sources including large sub-advised mandates and separate accounts; those mandates typically pay less than 40 Act mutual funds and may dilute blended fee rates, but the firm is happy to add them. For fixed income, they said demand will be strongest on the short end and highlighted Total Return Bond Fund as a top seller, with products like Ultrashort and Microshort appealing to investors.
"When we're talking about funding, John, the equity portion we expect to fund over the next 2 quarters." — Raymond Hanley (PRESIDENT)