The global asset management market is expected to decline to $598.9 billion in 2020 at a negative rate of 8.8 percent as a result of lockdown conditions and social distancing norms that have caused economic slowdowns across many countries, according to a new report from ResearchAndMarkets.com.
The new report, which assessed the current global asset management market, the impact of the ongoing COVID-19 pandemic, and projections for recovery, recognised that the global asset management market reached almost $656.9 billion in 2019 following a compound annual growth rate (CAGR) of 6.5 percent since 2015.
Although the report predicted declines for 2020, it suggested that the market could see a recovery in 2021 at a growth rate of 9.6 percent before reaching an expected $788.8 billion in 2023.
The report said that this increase would be driven by an increase in the wealth of high net worth individuals, demand for alternative investments and exchange-traded funds, and a retiree population.
Asset servicing is predicted an increase of $117.1 billion in global annual sales by 2023, with a particular concentration in the US market.
North America was identified to be the largest region in the global asset management market, making up 51.8 percent of the total in 2019. However, the fastest-growing segments are currently Africa and Western Europe, with predicted CAGRs of 7.9 percent and 5.5 percent, respectively.
It was also highlighted that the market is highly fragmented, with the top ten participants, including J.P Morgan Chase, Morgan Stanley and Goldman Sachs, accounting for 7.2 percent of the market.
Elsewhere, the fixed income subsection of the market is expected to provide the most opportunities as recovery from COVID-19 begins, with projected gains of $73.9 billion in annual sales by 2023.
The report concluded by recommending market trend-based strategies, such as investment in big data solutions to improve client acquisition and retention rates, include climate change expertise in product portfolios, deployment of more artificial intelligence applications, and focused personalisation services.
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