Tue, Oct 17, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

State Street report: The changing shape of European investment management

Thursday, September 23, 2010
Opalesque Industry Update - State Street Corporation today released its latest Vision Focus report on trends within the European investment management sector. Entitled “The Changing Shape of European Investment Management,” the report examines the structural changes that are defining the future model for the industry.

For Europe’s asset managers, the financial crisis and an evolving regulatory environment have reinforced cost pressures that have been building in recent years, creating a need to achieve scale and efficiencies through a focus on core competencies. Already, a wave of consolidation has begun that is likely to continue while asset managers embrace new ways to reengineer their businesses amid changing investor needs.

“Over the next five years, the pursuit of scale through consolidation by asset managers is set to be a defining trend, with the potential to significantly enhance the efficiency of the industry,” said Stephen Smit, executive vice president and head of State Street’s Global Services business in the United Kingdom, the Middle East and Africa. “Asset managers are rigorously reviewing their operational models, and we are seeing an increased trend toward outsourcing of investment operations. And with the forthcoming UCITS IV Directive, managers are also exploring the potential to further streamline fund ranges and reduce costs.”

The paper explores regulatory change as another key factor for the industry, assisting the efficiency drive and intensifying the cost pressures that are forcing consolidation. Post-crisis, investors are increasingly adopting the ‘barbell’ approach that mixes low-cost passive exposure with alpha strategies. Over the next five years, large asset management firms are set to emerge with low-cost, scalable business models, while others will focus on building stables of boutique managers.

“Asset managers must develop businesses that can meet investors’ changing needs,” said Mike Karpik, senior managing director and head of Investments and Fund Products for State Street Global Advisors in Europe, the Middle East and Africa. “Success will come to those firms that can offer investors clear, relevant and compelling propositions. Above all, asset managers will need a sharp focus on what they do best, underpinned by a lean and efficient operating structure.”

State Street’s Vision Series addresses key trends and developments impacting the financial services industry. Previous reports have focused on pensions, UCITS IV, exchange-traded funds and sovereign wealth funds. To download a copy of this Vision Focus report or others in State Street’s Vision series of in-depth reports, please visit www.statestreet.com/vision.

(press release)

State Street Corporation is one of the world’s leading providers of financial services to institutional investors, including investment servicing, investment management, and investment research and trading. With $19 trillion in assets under custody and administration and $1.8 trillion in assets under management at June 30, 2010, State Street operates in 25 countries and more than 100 geographic markets worldwide. For more information, visit State Street at www.statestreet.com.

- FG

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Regulatory - David Stockman: Trump tax reform overhaul is a pipe dream, stocks are heading for 40-70% plunge, Carried interest tax: How much does it matter?, Odey sees 'terrifying' mix in MiFID, tapering, asset values, Hedge funds come together to share cost of MiFID and research, SEC turns up the heat on U.S. investment advisers, India's Sebi asks hedge funds to report investments in commodity derivatives[more]

    David Stockman: Trump tax reform overhaul is a pipe dream, stocks are heading for 40-70% plunge From CNBC.com: David Stockman is warning about the Trump administration's tax overhaul plan, Federal Reserve policy, saying they could play into a severe stock market sell-off. Stockman, the R

  2. North America - Puerto Rico rejects loan offers, accusing hedge funds of trying to profit off hurricanes[more]

    From TheIintercept.com: Puerto Rico has rejected a bondholder group's offer to issue the territory additional debt as a response to the devastation of Hurricane Maria. Officials with Puerto Rico's Fiscal Agency and Financial Advisory Authority said the offer was "not viable" and would harm the islan

  3. Investing - WPP targeted by short-selling American hedge fund, Sun co-founder sells secretive hedge fund on big chip trade[more]

    WPP targeted by short-selling American hedge fund From Cityam.com: An American hedge fund has mounted a bet against WPP, the world's largest advertising group, with a trade worth almost £90m. Lone Pine Capital has built a short position worth 0.51 per cent of the FTSE 100 company,

  4. Hedge funds up as industry adjusts to rising rates[more]

    Komfie Manalo, Opalesque Asia: Hedge funds have reshuffled their portfolio after nearly four weeks of rising rates as the Lyxor Hedge Fund Index was up +0.2% from 19 September to 26 (+1.1% YTD), fuelled by strong results of global macro funds, Lyxor Ass

  5. Manager Profile - How the world's hedge fund king used 'idea meritocracy' to become a billionaire[more]

    From Forbes.com: In 1982, Ray Dalio made what he calls the biggest mistake of his life. He made a bet that there would be an economic collapse stemming from a debt crisis. And he was wrong. He lost money. He lost his client's money. He had to let people go from his firm and borrow money from his dad