Extensive research done by The CityUK, an independent membership organisation, in its Fund Management 2011 report shows assets under management for fund managers based in the UK grew by 17% last year to a record £4.8trn, on top of 13% year-on-year growth in 2009. Overall, this is 15% above its peak of 2007.
However, the same research shows that while inflows have continued the trend set in the previous year, the value of UK-domiciled retail funds fell during the first eight months of 2011 by 3%.
Institutional funds contributed nearly two-thirds of the assets, with retail funds adding 17%, 10% is in alternative funds and the rest comes from private clients. Some £1.6trn is held by overseas clients.
Marko Maslakovic, senior manager, economic research at TheCityUK, said: “Following two years of decline, fund management margins edged up in 2010 to 34% from 33% a year earlier, still below the 37% peak in 2007. Revenue of UK fund management activities totalled £16.1bn in 2010, up around a quarter on the previous year.”
The report goes on to say the UK has benefitted from the globalisation of the fund management industry with overseas firms operating in the UK managing more than half of UK funds under management. The UK has, however, lost market share as a domicile for funds over the past decade.
Globally, investment management assets grew by 10% in 2010, to a record $79.3trn, $24.7trn of which came from mutual funds with the balance in pension assets ($29.9trn) and insurance funds ($24.6trn).
Alongside alternative and private client assets the global fund management industry manages $117trn.
