The application of new technology is important in helping the investment funds industry to win new business and to deliver attractive, cost-efficient solutions to investors. Technology is also proving its worth in helping companies to manage risk and to maintain business continuity under stress conditions, such as those currently presented by the coronavirus. But which technology applications will enable asset managers to realise the greatest benefits from their technology investments? Which distribution channels will be most important to fund managers in the coming five years? And what challenges do asset managers face in providing attractive solutions to new investors?
Funds Europe, in association with Calastone, surveyed the industry to provide answers to these questions. Among its main findings:
- 72% of respondents say asset managers will introduce more ETFs and low-cost products as they refine their business models.
- 59% say fund managers will expand their wealth management arms and increase their focus on direct-to-consumer (D2C) channels.
- 65% say digital ledger technology (DLT) will deliver greater efficiency in fund trading and settlement.
- 46% say DLT will provide a foundation for better cooperation between participants in the funds value chain.
- 73% say that, as the funds industry comes under growing margin pressure, this burden will be felt most acutely by fund promoters.
- 80% say robo-advisory will expand as the funds industry seeks new mechanisms for delivering investment advice.
- 71% say that online retailers such as Alibaba pose the greatest threat to asset managers’ existing business models.
- 49% say that investment advice remains the “domain of the wealthy”.
For the fourth year, Funds Europe has partnered with Calastone to deliver a survey of dominant trends in the asset management industry. This report highlights the findings of research conducted in January and February 2020. Survey respondents were based in Europe and the UK.
© 2020 funds europe
