A report released by Allianz Global Investors (AGI) has delivered a wake-up call to the active management industry, revealing that only 23% of global investors surveyed believe their active profiles are worth the cost.
Outlining what investors expect of their investment managers, and what managers can do to regain trust, the report incorporates the views of nearly 500 institutional investors from around the globe with €13.3 trillion in assets under management.
It outlines that although active managers are best placed to deliver on the needs of investors, overall confidence in active managers is low.
“This report should serve as a wake-up call for those parts of the active asset management industry that have yet to grasp just how fundamentally our industry is changing,” said AGI’s chief executive officer Andreas Utermann.
Entitled ‘Staying Active: how to regain trust in active management’, the report found that investors are looking for asset managers to be able to evolve with their needs.
It identifies five key areas where asset managers should focus in order to improve their services and gain greater investor confidence.
These are: offering innovative risk approaches, facilitating ESG investing, informing investors on alternatives, championing innovative fee models, and taking advantage of new technology to capture market opportunities.
“In today’s challenging market environment, active management is more relevant than ever,” Utermann said.
He highlighted that “investment managers must maintain a laser focus on delivering for clients to be able to stand out and thrive in a crowded and consolidating market.”
The report also asked investors what their main concerns for this year were and found 80% said they are most worried by market volatility, 79% by monetary policy, and 75% by inflation.
Nearly 90% of respondents said they believe investors have become complacent over the ten years following the financial crisis.
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