International Finance
Asset Management Featured

Asset under management grows by 15% annually to reach $104.4 tn

20 largest asset managers accounts for 43% of total AUM

Asset under management (AUM) at the hands of asset managers across the globe has increased by 15 percent annually, reaching $104.4 trillion, according to a new research report by the Thinking Ahead Institute.
The report revealed that the 20 largest asset managers in the world now manages 43 percent of total assets. The figure stood at 38 percent in 2000 and 29 percent in 1995.

Assets managed by the largest 500 asset managers has also increased by almost three-fold since 2000, reaching $35.2 trillion.

Roger Urwin, co-founder of the Thinking Ahead Institute told the media, “The investment industry has always been dynamic, but the pace of change is speeding up, manifested notably through consolidation. In addition, rapidly advancing technology is changing the shape of mandates and producing products that require less governance and are more streamlined. This has led to the growth of passive and index tracking, factor-based strategies and solutions. Private markets have also continued a significant growth trend in the last decade, during which investors have sought higher returns involving higher risk.”

“Most asset management processes – including investment, operating and decision-making – are also having to evolve. This is being driven by, in particular, asset owners seeking the benefits of outsourcing; the increased use of the Total Portfolio Approach, especially when targeting absolute return; and the use of index tracking in ETFs, where there is an active choice of the index,” he added.

It was reported that European asset manager’s average asset fell by 1.5 percent during the first half of this year. During the same period, fees also shrank by 9 percent.

A survey carried out by credit rating agency Moody’s revealed that average profit margins (EBITDA) dropped to 27 percent, from 30 percent in the second half of 2019, due to lower management fees.

Leave a Comment

* By using this form you agree with the storage and handling of your data by this website.