The asset management industry may represent an untapped investment opportunity, says Neil Hennessy, chairman and CIO of Hennessy Funds, which manages $6 billion in equity-focused mutual funds.

“People often ask me what sector they should be in,” he said. “What everybody fails to see is if you truly believe the market’s going to continue to go out, the best place you could be is asset management.”

Fund managers can take advantage of economies of scale, according to Hennessy.

“If I add $1 billion more in assets on the books, I don’t have to get any more space. I don’t have to add people. I don’t have to add telephones. It’s my variable costs that go up, but other than that, more falls to the bottom line.”

Asset managers are the ones that have the most leverage, without leverage. “Think about T. Rowe Price, which has about $750 billion in assets under management,” Hennessy said. “Let’s say the market goes up 10%. Theoretically, their assets should rise by 10%. So that would put $75 billion more on their books. You’ve got Franklin, T. Rowe, Legg Mason, BlackRock, WisdomTree. That’s a sector of the market that I think is going to do well going forward, simply because I think the market’s going to do well.”

Optimism about the U.S. economy, asset growth, and revenue is spurring product development and hiring of sales and distribution staff in the asset management industry, according to Cerulli Associates’ inaugural Executive Leadership survey.

Firms have put the financial crisis behind them and are devoting resources to build the next chapter of industry growth and development. “We are able to validate that firms are confident and optimistic,” said Alexi Maravel, associate director at Cerulli. “They are no longer playing defense and are now proactive in devoting resources to grow and diversify their businesses.”

Hennessy Funds, based in Novato, Calif., distinguishes itself by doing its own shareholder servicing, which helps to cement customer relationships as well as to hold down expenses.

“We have no voice mail. When a shareholder phones our office, they get a real live person on the phone,” said Hennessy. “Either I’ll pick it up, or my CFO, our financial people sales people, administration, the front desk, anybody, and they answer our shareholder’s questions right then and there.”