Asset Management Mid-year Outlook 2025: A Halftime Reset Not A Retreat Goldman Sachs Asset Management

These ETFs allow for diversification across various sectors and countries, providing exposure to high-growth markets while mitigating some of the risks inherent in direct investments. The USA asset management market was valued at USD 48 trillion, driven by technological advancements, growing wealth, and a diversified portfolio approach by both institutional and retail investors. Until regulators issue better and clearer guidance, however, asset managers should consider the recommendations published by the numerous investor-led organizations discussed herein, such as PRI, Ceres, or GFANZ, and follow the now well-recognized disclosure frameworks such as the TCFD recommendations, which have earned credibility within the asset management industry and with regulators over the last several months.

• They are exempt from the requirement to hold an Australian financial services licence under the Corporations Act of Australia and therefore do not hold any Australian Financial Services Licences, and are regulated under their respective laws applicable to their jurisdictions, which differ from Australian laws.
• They are, therefore, intended for experienced and sophisticated long-term investors who can accept such risks.
• We have set a benchmark in the industry by offering our clients with syndicated and customized market research reports featuring coverage of entire market as well as meticulous research and analyst insights.
• Rising costs, competition, and complexity will present its challenges, but with a plan, firms can mitigate risks and reap the rewards.

Banks And Financial Institutions

Helping individuals to save for old age, as governments step back, will also support growth. How well firms embrace technology will help to determine which prosper in the years ahead. The industry is a digital technology laggard. As low-cost products gain market share, and larger players benefit from scale economies, there will be further consolidation and new forms of collaboration.

• Therefore, it is crucial for asset managers to actively manage the competitiveness of their product offerings.
• Firms are offering more products to retail investors, stepping up their focus on private wealth, and incorporating new features into existing strategies.
• As asset managers claim more direct relationships with investors, they will earn more trust, share of wallet, and data.
• EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity.
• Shona serves as Grant Thornton’s Head of Asset Management, leading the firm’s global community of professionals to address emerging trends and challenges in the industry.

B Institutional Investor Disclosure Frameworks

All fixed income investments may be worth less than their original cost upon redemption or maturity. The index provides a general indication of the dollar’s strength or weakness in the global market. It represents the investment-grade, fixed-rate, taxable corporate bond market. The US retains significant advantages, in our view, providing a deep investment opportunity set for investors. The depth and breadth of US credit markets will also likely sustain foreign demand, although the prospect of credit spreads reaching new historical lows may be diminished.

• Conversely, variable and floating rate securities will not generally rise in value if market interest rates decline.
• Empaxis empowers wealth managers with the operational efficiency and technological edge needed to thrive in today’s dynamic market.
• The EU has gone farther—taking formal action to standardize and improve the ways in which asset managers’ disclosures describe climate-related risks.
• However, our findings indicate that leading asset managers can enhance their margins by 4-8 percent by optimizing pricing on new mandates.

Boost Wealth Management With Targeted Strategies

Fallen angels refer to volume of US debt that has been stripped of its investment grade rating. Explore our Mid-Year Outlook investment themes Broader Equity Horizons and Income Generation and Alternative Routes to Resilience, and the potential sources of attractive returns they could create. However, careful monitoring of investment flow trends is crucial. Furthermore, the decline in the US dollar’s dominance as the global reserve currency is not expected to be linear or dramatic.

• When markets are moving upward, you may want to buy high-momentum stocks that have trending earnings.
• Some asset managers have therefore introduced dedicated strategic account coverage (SAC) teams responsible for managing strategic partners.
• Tools powered by internally developed AI models and generative models automate key tasks like data scraping, model updates, sector screening, and transcript summarization.
• 2025 will again push firms to evolve in response to changing market, client and staff expectations.
• The comprehensive platform lets you build assets, manage portfolios, and show how your data-backed recommendations align with investor goals.
• In this webinar, done in association with ESI ThoughtLab, we discussed the evolving consumer needs, future of wealth management, and how companies can adapt for growth.

Modernize Data To Harness The Power Of Ai And Other Disruptive Technologies

The tokenization of otherwise illiquid assets will present a significant opportunity in economizing private debt and equity allocations in portfolios. Digital assets are entering a new phase of maturity. The modern platform for growing investment managers This investment management trend adds to the demands of processes and systems. When the market moves from one allocation (e.g. listed emerging markets) into another (e.g. domestic private markets), being fast to market is a competitive advantage. According to our research, 70% of investment managers are concerned about system costs.

A Investor-led Climate Change Organizations

Given the current state of climate-related U.S. regulatory disclosure guidance, asset managers have been advocating for and relying on third party organizations, frameworks and principles (such as the TFCD recommendations advocated for in the 2021 Global Investor Statement) to help address the various challenges facing asset managers in the era of climate change. An asset manager that invests in a company that fails to properly disclose its ESG characteristics may be unknowingly misleading its clients regarding sustainability characteristics of their investments. For example, the report encourages banks to collect “new and unique types of data” such as data concerning physical and transition risk drivers (e.g., climate information or information about current and projected hazard events), vulnerability to exposures (e.g., counterparties’ sensitivity to energy prices or carbon emissions in production and distribution), and translating climate-adjusted economic risk factors into financial risk (e.g., adjusting current systems projecting cash flows, valuations, or prices to account for climate change risk). In particular, it explains how banks can translate climate risks into quantifiable financial risks to enable them to manage their exposure to climate transition risk. Fourth, while banks and supervisors remain at an early stage of translating climate-related risks into robustly quantifiable financial risk, work continues to gather pace.

The modern-day asset management leader must be an expert not only in investment strategy, but technology, client servicing, and business development. The Middle East is one of the fastest growing regions in the world for asset management, and the region’s assets under management jumped by 13% to $2.3 trillion. The outgoing Biden administration took a first step with regulations, laying out the first-ever framework to capture the potential benefits of digital assets while mitigating the risks.

Digital Transformation Services For An International Management Consulting

The impact of this shift is evident in the rapid growth of the consumer market (see Fig. 3). Investors are increasingly aware of their investments’ impact on society and the environment. The ESG strategy means factoring in non-financial issues in investment decisions. Collaborating with experienced companies can help you tap into new growth and investment opportunities. As it happens, the robo-advisors market shows unprecedented growth (see Fig.2).

The global economy is entering a period of structural change, characterized by persistent inflation, deglobalization, and demographic shifts. We continue to be on the lookout for investment opportunities that embrace the implementation of AI innovation and best practices. Artificial intelligence and machine learning are no longer experimental tools but core components of advanced investment strategies. Exclusive access to allocators and managers in . Limina’s Investment Management Solution (IMS) combines the workflows you need with powerful data & automation capabilities – all in one solution.

Rich data will be essential to provide superior insights and advice to clients, with much of that data coming from partners. Stablecoins, tokenized assets, and private credit are creating new off-balance-sheet arenas, and interest is growing in tokenized assets and private credit. New forms of Everestex exchange review assets create new consumer value—and competition. Even private equity and debt markets are becoming more accessible to individuals via new digital platforms and the easing of regulations. And alternative asset firms such as KKR and Blackstone have been directly engaging with large family offices and ultra-high-net-worth individuals.

Although organic AUM growth—net flows into long-term managed assets divided by beginning of period long-term AUM—will likely slow, we expect to see the industry sitting on an estimated $27.2 trillion in total AUM at the end of 2034. When you’re up to date on the latest asset management trends, it can improve your ability to make better investment decisions. As the financial landscape evolves, so do the challenges and opportunities for asset managers.