Assets managed by the world’s largest 500 fund managers rose by 16% in 2009 to US$62 trillion at the end of the year. This is in contrast to a 23% loss the year before, according to the Pensions & Investments / Towers Watson World 500 ranking. The research also shows that although the percentage rise in total assets in 2009 is the second largest since the research began in 1996, asset levels are still below 2006 levels. In addition, during the past five years only half of the fastest growing firms have done so in a primarily organic way, with the other half doing so by merger or acquisition.
Carl Hess, global head of investment at Towers Watson, said: “2009 was almost the exact opposite of 2008 with the majority of fund managers posting strong results. However, while the markets continue to recover, there is a fragility and volatility about them which reflects the weak underlying economic fundamentals and the oscillating risk appetites among institutional investors.”
The research, conducted in conjunction with P&I, a leading US investment newspaper, reveals that the top 20 managers’ share of total assets increased from 38% to over 40%. It also shows that, by number, bank-owned asset managers continue to dominate the top 20, although the number of independent managers in the group grew. There are 12 US-based investment managers in the top 20 (up from ten the year before), managing 63% of these assets, up from 51%, while the other eight managers are all European-based.
Carl Hess said: “The larger firms were again the main beneficiaries of the rebound and increased their share of total assets to the highest levels since the research began. Market returns, new inflows, performance fees combined with reduced overheads will have eased the pressure on asset management firms bringing most of them back into profitability.” READ MORE