Global realignment in funds management industry to secure income products
The financial crisis has accelerated a global industry realignment that is underway in funds management products as a result of the baby boomer generation moving into retirement, with a growing focus on more secure products that provide a steady income to investors, according to director of research at Casey Quirk and Associates Ben Phillips.
Speaking at a CFA Society of Sydney breakfast, Phillips said there was less tolerance for risk from clients in the current market environment, and baby boomers were looking for more security. This would change the focus of the funds management industry from profits to more secure income-providing products.
This process was already underway as baby boomers move to retirement, but the effects of the financial crisis have accelerated it, Phillips said.
Global asset management revenues have dropped by 12 per cent in the first quarter of 2009, on top of a 23 per cent plunge in 2008.
Phillips said the funds management industry has never experienced such a lengthy contraction.
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