Rising Equity Markets and Continued Strong Inflows Have Been Lifting BlackRock's AUM
For much of the past two decades, we've bemoaned the fortunes of the US-based traditional asset managers, noting that they would face significant secular headwinds (from aging baby boomers to the growth of passive investing) and cyclical headwinds (leading to more-volatile equity and credit markets) that would pressure their top and bottom lines. Regulatory changes around the globe aimed at increasing transparency around fees and performance, as well as pushing for a greater degree of fiduciary responsibility in retail-advised relationships, have only raised the hurdles for the US-based traditional asset managers we cover. With the gatekeepers for retail intermediary platforms also becoming much more focused on fees and performance when deciding what products to place on their platforms, the industry is facing fee and margin compression as active asset managers are expected to not only narrow the spread between the management fees charged for their funds and the fees attached to index-based products but spend more heavily to improve investment performance and enhance product distribution.
United States