The landscape of asset management is undergoing a significant transformation as the boundaries between traditional asset classes continue to blur.
Against this backdrop, Funds Europe and Societe Generale Securities Services (SGSS) have launched a comprehensive research initiative to investigate the accelerating trend of fund hybridisation.
Through survey-based data collection and interviews, the research aims to capture a snapshot of how European market participants are approaching the opportunity.
Investigating the hybrid frontier
The survey is extracting deep insights into how the industry views funds that invest across both publicly listed and private market assets.
Julien Aidan, product engineer on private market funds, SGSS, notes: “In today’s environment of higher rates, geopolitical uncertainty and increasing pressure on performance, private markets are reshaping investment strategies. As a pioneer in unlisted markets, SGSS is pleased to partner with Funds Europe to explore how asset managers are adapting their models to capture new opportunities.”
The research addresses multiple critical pillars of hybridisation:
- Strategic relevance and motivation: Understanding why organisations are pivoting toward hybrid models, exploring whether the primary drivers are client demand, portfolio diversification, or a strategic response to current market volatility.
- Operational execution: The survey probes into the most critical operational challenges, which may include liquidity management, valuation of private assets, and the robustness of existing technological systems.
- Value creation and risk: Understanding the perceived levers of value, such as liquidity pooling and risk-return optimisation. Conversely, it investigates risks that may be underestimated by the market, including regulatory compliance and potential customer misunderstanding.
- Market adoption and distribution: The research maps out which customer segments – from institutional pension funds to mass affluent investors – are most suited for these products and identifies the obstacles preventing wider distribution.
Capturing market sentiment
Beyond strategy, the research looks at the practicalities of fund design, including optimal domiciliation hubs like Luxembourg and Ireland, and the ideal frequency for subscriptions and redemptions. It also assesses whether the industry believes the operational complexity of these funds is adequately remunerated.
As the industry seeks more flexible vehicles, the appetite for these “best of both worlds” solutions is clear.
Amandine Bozier, product engineer on private market funds, SGSS, adds that “at a time when investors are seeking the best of both worlds, and hybridisation of funds mixing listed and unlisted assets is gaining ground, it is time to discover market players’ insights.”
Publication will be after the summer.
