Brexit negotiations will not prompt a large migration of fund managers away from the UK, research indicates.
Fund administrator SGG Group, which provides services for alternative investment funds such as private capital, surveyed fund managers and investors and found 72% of fund managers will not consider switching their fund domicile away from the UK as a direct impact of Brexit.
Luxembourg was the location of choice for UK-based fund managers that said they would re-domicile. All respondents that were considering shifting from the UK identified the Grand Duchy as their preferred destination.
Survey respondents predicted difficulties after Brexit in attracting investors to alternative funds, with just over three quarters of them saying it would be more difficult to attract funding after Brexit via limited partnership arrangements. Only 16% of fund managers said that they expected the outlook for fundraising to improve during 2019.
In these conditions, respondents said that clear and transparent investor relations will be particularly important for investment firms wishing to outperform their growing competition.
Justin Partington, group fund solutions leader at SGG Group, said: “How Brexit will affect the UK fund management industry still largely remains unclear. However, it is positive to see that the industry especially small to medium fund managers plan to remain rooted in London.”
SGG said the findings were from a section of an industrywide survey of over 120 managers.
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