The german funds industry is enjoying a boom period, with assets under management doubling over the past decade. However, investor demand is changing.
After disappointment with multi-asset funds, German investors are now more cautious about this fund sector, while at the same time managers say demand for real estate and other types of private market investments is increasing due to the low-yield environment.
German firms with international ambitions also feel challenged, particularly from US players. The industry’s German trade body, one of the most vociferous in Europe, considers MiFID II to be a disaster that has caused a 27% drop in investment in securities and says “over-regulation” in the EU is impeding firms from developing their strengths on a global scale.
In the meantime, some firms will be focusing on protecting their domestic market share. Investor appetite on their home turf may continue to carry firms through – but only if they can gain exposure for clients to private markets.
Nick Fitzpatrick, group editor, Funds Europe
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