Conference Dailys TRADETech Daily 2018 Wrap-up | Page 7

THETRADETECH DA I LY
latest news
THE OFFICIAL NEWSPAPER OF TRADETECH 2018
BUY-SIDE
Asset managers riding high
but margin pressures loom
A new report from Boston Consulting Group has found global asset managers record-
ed a banner year in 2017 with net inflows of 4.3% in an “exceptionally good year” for
the industry.
The report, based on a preliminary sample of 30 institutions representing $34 trillion
of assets under management (AuM), also found AuM grew by 14% in 2017 with profits
increasing 9% year-on-year.
However, the report also warns that the asset management landscape is prepped
for change, primarily through the emergence of new trading technologies, and that
asset managers should prepare for higher margin pressures to take a significant toll on
profits.
BCG’s report said that the increased performance of global asset managers was
primarily market driven and “should not disguise the trends that are squeezing profits”,
citing the con tinued fall in asset management fees which have dropped 3% for each for
the past three years.
“The strategic problem for asset managers is not the need to know what is coming,
but the need to take the actions required to stay in front of whatever occurs,” said
Brent Beardsley, a BCG senior partner, co-author of the report, and global leader of
BCG’s asset and wealth-management segment.
“Some bold moves will be required—radically overhauling technology, entering new
markets, and making acquisitions, among others. These are daunting challenges,
but the extraordinary market-led performance of 2017 puts many players in a strong
position to take them on.”
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