Global funds reach $120 trillion

Nov 13, 2012 12:00 AM

The fund management industry has rebounded from the global financial crisis and conventional assets under management are now 13 percent above pre-crisis levels, a report said.

Total assets of the global fund industry, including hedge funds and private wealth, are worth around $120 trillion, with conventional assets under management up 5 percent in 2012 to $84.1 trillion, the report by TheCityUK said.

“The fund management industry has recovered quickly from the sharp fall in assets under management at the outset of the credit crisis, with most of the recovery coming from market performance rather than new inflows,” the London-based group tracking the financial services industry, said.

It said conventional assets under management by pension funds, mutual funds and insurance companies had risen 5 percent in the first three quarters of 2012, and 13 percent from pre-crisis levels, and were set to end the year at $85.2 trillion.

The United States was by far the biggest source of funds, accounting for nearly a half of conventional assets under management or some $36 trillion. The United Kingdom and Japan accounted for around 8 percent each.

Pension assets accounted for nearly 40 percent of conventional funds, with the remainder split almost equally between insurance companies and mutual funds, the report found.

Alternatives, including hedge funds, sovereign wealth funds and exchange-traded funds had over $10 trillion in assets. Sovereign funds' assets under management jumped 9 percent in 2011 to a record $4.8 trillion and TheCityUK forecasts this to rise above $5 trillion in 2012.

Private wealth assets totalled $42 trillion by end-2011, a fall of 1.7 percent on the year, though a third of this was incorporated in other forms of investment management, the report said. There was no data for 2012.

The weak spot was private equity where TheCityUK estimates $93 billion in global investments during the first half of 2012 compared with $246 billion in 2011. That in itself was down 6 percent on 2010 and two-thirds below the 2006-2007 peak.

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