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UK asset management industry booming

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  • Publish date: 25 September 2017
  • Archived on: 11 January 2018

Total assets under management in the UK rose by 20 per cent last year to a record £6.9 trillion, according to the Investment Association (IA)'s first annual Asset Management Survey since the EU referendum took place.

This compares to an average rise of eight per cent per year over the last 10 years, and means the UK remains the world's second biggest asset management centre after the US.

However, the Investment Association concedes that the strong growth largely reflected increases in the sterling equivalent value of overseas assets as the UK’s currency weakened in the wake of the Brexit referendum.

Interesting takeaways from the study include the fact that at the end of 2016 around £900 billion was managed on behalf of fund ranges in Dublin and Luxembourg, which delegate their fund management activity to the UK. Retaining this delegation arrangement will be key to maintaining the UK’s position in a post-Brexit world, the survey states.

It also notes that there’s been a shift into outcome-oriented products with positive retail sales of £8.7 billion in 2016. Absolute Return funds were the most popular sector within this asset class with £5.1 billion of net new retail money flowing into the sector. This reflects a structural change in both institutional and retail investor behaviour and is one which IA members expect to continue in the coming years.