Low returns erode investment FUM/A
Low investment returns in the major asset classes and negative returns in other asset classes have taken a toll on funds under management and advice (FUM/A) growth across investment sectors for the 12 months to June, DEXX&R found.
The DEXX&R Analysis Market Share Report, based on retail and wholesale FUM/A data as at 30 June, found that multi-sector returns for the 12 months to 30 June, averaged one per cent, Australian shares 0.5 per cent, and international shares negative three per cent.
The retirement income segment, however, showed growth, with an average return of 4.7 per cent over the same period due to the higher proportion of total assets held in fixed interest.
Retail and wholesale managed funds FUM/A increased by 0.2 per cent or $2 billion to $1.117 trillion over the 12 months to 30 June.
Retirement income FUM increased by 2.1 per cent, of $13 billion for the year.
Among the five largest retail and wholesale managers, National Australia Bank (NAB) recorded a one per cent decrease to $151.8 billion, AMP a 6.2 per cent increase to $148.4 billion, while the Commonwealth Bank (CBA) recorded a 1.9 per cent decrease to $138.5 billion, and Westpac a 0.7 per cent increase to $132.2 billion.
"Note AMP reclassified and included additional FUM/A not previously reported in the June quarter. This additional FUM/A accounts for a significant portion of AMP's increase in FUM/A in the June Quarter," the report said.
Retail and wholesale FUM/A increased by 1.2 per cent, from $1,104 billion at March 2016, to $1,117 billion at June 2016.
Retail investment (non-super) FUM/A increased by 7.2 per cent, or $12.5 billion, to $185.6 billion over the year to June 2016.
"Excluding the $10.43 billion Macquarie internal asset transfer made during the December quarter retail non-super FUM/A increased by 1.2 per cent, or $2.0 billion, up from $173.2 billion at June 2015 to $175.2 billion at June 2016," the report said.
NAB FUM/A declined by 5.3 per cent, down $1 billion to $16.6 billion, while CBA recorded a 2.6 per cent increase to $30.9 billion.
AUTHOR
Malavika Santhebennur
Recommended for you
Grant Hackett has been promoted from CEO of Generation Life to head up the wider Generation Development Group.
Tribeca Investment Partners has made a distribution hire from Australian Ethical in a newly-created role focused on the national intermediary market.
Asset managers may be urged to diversify their product ranges, but investment executives have warned any M&A deal should avoid simply filling gaps and instead consider long-term value creation.
Specialist wealth platform provider Mason Stevens has become the latest target of an acquisition as it enters a binding agreement with a leading Sydney-based private equity firm.
