Companies that provide access to third party funds – a fund distributed by a bank or other distributor that belongs to a third party as opposed to a bank – will see their market share increase as the advisory channels through which they reach their end clients continue to evolve, according to research published in the fourth-quarter issue of Cerulli's Edge-Europe Edition.
"Investors are demanding third-party funds like never before," said the publication’s London-based editor, Barbara Wall, who adds that even in territories such as recession-hit Spain, these groups are set to grow.
Wall cited data that she notes suggests foreign funds are approaching €50bn (US$67.5bn) in Spain, as investors switch from domestic products to global, emerging markets, and multi-asset funds.
The report adds that independent financial advisers are keen to play up their non-tied status, and are attracting high net worth clients. This, it notes, "has been enough to tempt foreign groups to woo them directly".
Italy is another territory attracting the attentions of international fund groups, according to Cerulli. “While it is unclear if the move to fee-based advice will happen quickly, the independent non-bank network is the only distribution segment growing in Italy,” the report said.
Senior Cerulli analyst Angelos Gousios suggested that independent and international fund groups will continue to grow their market share in this region as private bank distribution channels open up to third-party funds and the independent channel becomes increasingly influential.
The research also revealed that products selling well in Italy include asset allocation, absolute return, and, most recently, equity income products. Alternatives are also doing well.
Other findings from the Cerulli report:
- Overseas clients of the UK's Investment Management Association account for 40% of all members' assets under management
- London is often the first choice for both American and Asian firms. These groups might have significant AUM at home, but can be relatively unknown abroad
- There has been a rapid reshaping of Swiss financial services for both domestic and international clients, with banks shedding or acquiring asset or wealth managers, and cross-fertilization of both products and business structures.
- For the most, part regulation, originally seen by the industry as a threat, is increasingly being seen as an opportunity for the industry and its clients
