Markets: who’s who among the world’s largest investment managers

Total assets under management of the world’s 500 largest asset managers reached $128 trillion by the end of 2023according to the latest study of the Thinking Ahead Institute (TAI). So throughout last year they grew by 12.5% ​​although they have not yet recovered the levels of 2021. However, the improvement marks a significant recovery compared to the significant correction in 2022 when the total assets under management fell by US$18. billions.

The study also reveals the continued evolution of assets under active versus passive management among major investment managers. “For the first time, passive investment strategies now account for more than a third of assets under management among the largest 500 companies (33.7%)although this still leaves almost two-thirds of the assets managed by the world’s largest managers in active strategies,” says TAI, the research network founded by Willis Towers Watson Investment.

Allocations by asset class have also evolved, with renewed growth in private markets, where equities and fixed income remain the dominant asset classes, representing 77.3% of total assets under management (48.3% variable income and 29% fixed income). However, “this marks a slight decrease of 0.2% compared to the previous year, as “Investors turned to alternatives such as private equity and other illiquid assets in search of profitability.”says the study.

On the other hand, partly due to the recent dominance of US stocks as performance drivers, North America saw the largest growth in assets under management, up 15%, closely followed by Europe (including the UK), up 12.4%. Japan saw a slight decline, with assets under management declining 0.7%. As a result, North America now represents 60.8% of the total assets under management of the top 500 managers, with $77.8 trillion at the end of 2023. So At the top of the rankings, US managers account for 14 of the top 20 and account for 80.3% of the top 20’s assets.

Markets: the ranking and strategies of the main investors

As for individual asset managers, the study shows that BlackRock remains the largest asset manager in the world, with assets exceeding $10 trillion once again, while Vanguard Group occupies a solid second place with almost $8.6 billion in assets under management and both remain well ahead of Fidelity Investments and State Street Global, which occupy third and fourth place respectively.

Among the companies that have risen notably in the entire ranking in the last 5 years are Charles Schwab Investment, which rose 34 places from 59th to 25th; Geode Capital Management, also based in the US, rose 31 places from 54th to 23rd, while Canada’s Brookfield Asset Management rose 29 places from 60th to 31st.

Jessica Gaodirector of the TAI, commented that asset managers have experienced a year of consolidation and change; While there has been a return to strong market performance, the past year has also seen forces of change. “Macroeconomic factors have played a key role in this story, with notable highs in interest rates during 2023 which have put varying pressure on different asset classes, geographies and investment styles. Now as this gradually shifts towards a rate cut environment, equity markets are starting to show positive performancealso driven by improving earnings growth expectations. “Uncertainties for the future now focus on geopolitical events and several important elections.”explains, adding that they have continued to see net flows into passive strategies as they continue to offer an attractive value proposition, particularly in terms of lower fees and simplicity. “However, increasing market volatility and concentration issues, which often highlight the need for expertise to outperform benchmarks, may cause some passive investment allocators to be cautious,” warns Gao. .

Meanwhile, asset managers continue to face great pressure to develop their own business models, says Gao, who believes that investment in technology remains essential not only to maintain an advantage in the market, but also to meet changing needs. and customer expectations for reporting and customer service. “Increased competition, fee compression and growing demand for more personalized and technology-driven investment solutions are challenging traditional structures. “We have witnessed notable successes of independent asset managers over many of the more affiliated asset managers linked to insurers or banks,” he said.

Who is who in the ranking of money managers?

According to TAI’s ranking of the world’s largest money managers ranked by total assets under management in 2023, the global Top Ten (in dollars) comprises BlackRock with just over 10 billion followed by Vanguard Group with almost 8.6 billion; Fidelity Investments with 4.58 billion; State Street Global with almost 4.13 billion; JP Morgan Chase more than 3.42 trillion; then Goldman Sachs Group 2.81 billion; the Swiss UBS with 2.62 billion; Capital Group with more than 2.53 billion; the German Allianz Group with almost 2.46 billion; and the French company Amundi with 2.25 billion closes the top ten.

Next are BNY Investments with more than 1.97 billion; Invesco with about 1.59 billion; the English Legal & General Group 1,475 billion; Franklin Templeton 1.455 billion and Prudential Financial with almost 1.45 billion. Behind these leaders are T. Rowe Price Group with more than 1.44 billion; Northern Trust 1.43 billion; Morgan Stanley Inv. Mgmt 1.37 billion; the French BNP Paribas 1.36 billion and finally the other gala Natixis Investment Managers with almost 1.29 billion.

In 2024, the world’s top 500 investment managers will reach a total of US$128 trillion, when a year ago they did so with US$113.7 trillion, in 2022 with US$131 trillion and in 2020 with US$119.5 trillion. . It is worth remembering that in 2022, TAI indicated that the 13.7% drop in total managed assets represented the first significant drop since the 2008 global financial crisis.