Luther King Capital Management boasts a solid wealth business that both supports and is somewhat at odds with managing its investment strategies to outperformance. It earns an Average Parent rating.
Founder and president Luther King has gained the trust of many high- and ultra-high-net-worth clients, growing the firm's assets under management to $27.8 billion as of mid-2024. These clients are the firm's core focus, and this business helps support the investment team managing its suite of seven, mostly equity-based mutual funds, most of which are offshoots of the firm's separately managed account strategies. The mutual funds serve smaller-balance clients, with aggregate assets of $1.3 billion. The firm’s wealthier clients are not as focused on the strategies' benchmark- and peer-relative performance, and in fact, long-term results for the LKCM funds are overall disappointing. King acknowledges this tension between interests and is committed to outperformance, but the incentives here don't align as clearly as at other fund managers.
The Fort Worth, Texas-based corporation is owned by King, his two sons who lead its public and private equity teams, and more than a dozen other employees. This should help the firm transition to new leadership when King, whose career spans six decades, steps away—something that seems far from imminent. Still, only time will tell the extent to which the firm's relationships with key clients will persist into the next generation.
Note: This share class' Parent Pillar rating is analyst-driven, as its Branding Name, LKCM (Branding Name ID: BN0000098K), is covered by Morningstar Manager Research.
United States