Third-Party Asset Management Trends and Forecast
The future of the global third-party asset management market looks promising with opportunities in the financial institution and enterprise markets. The global third-party asset management market is expected to grow with a CAGR of 6.2% from 2024 to 2030. The major drivers for this market are increasing globalization of businesses.
• Lucintel forecasts that, within the type category, current asset is expected to witness the highest growth over the forecast period.
• Within the application category, financial institution will remain a larger segment due to their large asset pools and complex investment needs, making internal asset management less efficient and requiring specialized expertise.
• In terms of regions, North America will remain the largest region over the forecast period due to strong presence of established financial institutions.
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Emerging Trends in the Third-Party Asset Management Market
Changes in technology, regulations, and investment strategies reflect the trends in the third-party asset management market.
• Digital Transformation: The utilization of digital channels and methods that augment the effectiveness and reach of asset management.
• AI and Analytics: The use of AI and other sophisticated analytics in investment decision-making and risk management is on the rise.
• ESG Investing: The focus on ESG (Environmental, Social, Governance) investing increases within investment strategies and products.
• Blockchain Integration: Blockchain technology is used for transactions and record-keeping of assets that require structure and trust.
• Customization: The provision of tailor-made investment products in response to the unique and varying preferences of customers.
Emerging trends in the third-party asset management market demonstrate the importance of improving technologies, regulatory environments, and changing investor preferences for the future of asset management.
Recent Developments in the Third-Party Asset Management Market
Over the last year, changes in the third-party asset management market have revolved around technology, the evolution of regulations, and the direction of investment practices.
• Technology Integration: More digital platforms, AI, and big data tools are being used in managing assets.
• Regulatory Changes: The adoption of new measures, such as MiFID II in Europe, ensures disclosure and protection for investors.
• Sustainable Investing: Ongoing investments in ESG products and initiatives to keep pace with global trends and investor demand.
• Market Expansion: Increased participation by international asset management companies in developing markets, driven by regulatory changes and higher levels of overseas investments.
• Blockchain Adoption: The implementation of blockchain technology for record-keeping and transactions to ensure the safekeeping of assets.
• Customization and Personalization: The introduction of customized investment strategies to fit the specific needs of individual clients or groups.
• Enhanced Risk Management: Investment in new tools and techniques associated with risk management to help mitigate market risks and comply with regulations.
Recent developments in the third-party asset management market indicate that the sector is shifting towards technology, responsibility, and green growth.
Strategic Growth Opportunities for Third-Party Asset Management Market
Strategic growth opportunities in the third-party asset management market are driven by technology, regulation, and geographic focus.
• Technological Advancements: Financial investments in technology positions to improve asset management practices and enhance client experiences.
• Regulatory Alignment: By complying with emerging trends and practices in these markets, organizations can strategize to control competition and enhance trust.
• Sustainable Investing: Expanding the range and number of investment products that fulfill ESG requirements to address the growing demand for meaningful investments.
• Global Market Expansion: Gaining a competitive advantage in the growing demand for investment opportunities in developing economies.
• Blockchain Integration: The integration of blockchain technology to facilitate secure and fast transactions while enhancing visibility.
• Client Customization: Offering tailored investment portfolios and strategies to meet the specific needs of clients.
• Partnerships and Collaborations: Forming strategic partnerships to meet institutional goals and provide effective tools for asset management.
Market expansion strategies for managed accounts target technology adoption, meeting legal requirements, and geographic reach to drive creativity and value addition.
Third-Party Asset Management Market Driver and Challenges
The third party asset management market in capital markets encompasses both opportunities as well as threats where opportunities are created by technology and regulation but threats mainly arise from regulation.
The factors responsible for driving the third-party asset management market include:
• Regulatory Compliance: Exploration of compliance related issues around the provisions of the towers deals’ capital targets outlining regulatory standards.
• Sustainable Investing: Sustainable funds have enacted the widely supported restrictions against extended lending inimical to the borrowers as is now the trend in the industry.
• Market Expansion: Expansion of growth and development of markets for international pension funds increasing the potential development opportunities.
• Enhanced Risk Management: Utilization of innovative risk management mechanisms supporting improvement of the investment approaches and the processes.
• Customization and Personalization: Creation of unique flexible investment products according to various client’s needs.
Challenges in the third-party asset management market are:
• Regulatory Complexity: Constantly changing rules and terms and conditions of compliance require a lot of time and effort.
• Data Security: Hosting companies face issues of safe storage of financial information and do address the concerns with regard to cybersecurity.
• Market Competition: Rivals softening up the straddle leading asset managers to pricing wars and problems in identifying ponies.
• Integration Issues: Problems in assimilating advanced solutions with the already used operations.
• Client Expectations: A growing need for more personalized and greener investing solutions.
The growing demand for technology, compliance with regulations, and socially responsible investing characterizes the third party assets management market. However, it is beset with issues on regulatory complexity, data security, and market competition. In order to have a sustained and successful business, it is imperative to deal with these issues and at the same time take advantages of the optimists in the market.
List of Third-Party Asset Management Companies
Companies in the market compete on the basis of product quality offered. Major players in this market focus on expanding their manufacturing facilities, R&D investments, infrastructural development, and leverage integration opportunities across the value chain. Through these strategies third-party asset management companies cater increasing demand, ensure competitive effectiveness, develop innovative products & technologies, reduce production costs, and expand their customer base. Some of the third-party asset management companies profiled in this report include-
• SmartX Advisory Solutions
• Goldman Sachs Asset Management
• Lazard Asset Management
• Kayne Anderson Rudnick
• Karpus Investment Management
Third-Party Asset Management by Segment
The study includes a forecast for the global third-party asset management by type, application, and region.
Third-Party Asset Management Market by Type [Analysis by Value from 2018 to 2030]:
• Current Assets
• Private Equity
• Real Estate
• Private Credit
• Venture Capital
• Others
Third-Party Asset Management Market by Application [Analysis by Value from 2018 to 2030]:
• Financial Institutions
• Enterprise
• Others
Third-Party Asset Management Market by Region [Analysis by Value from 2018 to 2030]:
• North America
• Europe
• Asia Pacific
• The Rest of the World
Country Wise Outlook for the Third-Party Asset Management Market
The following content highlights recent changes in the third-party asset management market from key players in the major regions: USA, China, India, and Japan.
• USA: In the USA, the third-party asset management market is increasingly technology-driven and regulation-focused. Key trends include a growing number of asset management platforms and AI-enhanced tools. Companies are using superior analytics to improve decision-making and mitigate risks. There is also a shift toward sustainable and socially responsible investments, and progress is being made in extending compliance capabilities to meet new cross-national requirements, including social impact and other forms of ESG.
• China: In China, the third-party asset management market is poised for growth as the country seeks to expand its financial sector to foreign investments. The increased participation of foreign asset managers is driven by new guidelines that permit foreign ownership. Chinese asset managers are using AI and big data to reshape the industry and adapt to laws concerning Sino-investments. The market is also shifting towards more diversified investment products, including those in technology and innovation. There is growing emphasis on harmonizing with global investment practices.
• India: In India, the growth potential for third-party asset management is driven by the presence of advanced financial services and increasing investor knowledge. Recent developments include the rise of online platforms and app-based asset management, which promote transparency. There is also an increased focus on using the latest analytics technologies and AI to improve portfolio management and risk assessment. The market is being shaped by regulatory changes that improve disclosure and protection of investor assets. Additionally, more asset managers are integrating ESG practices to meet growing demand for sustainable investments.
• Japan: In Japan, growth in the third-party asset management market is driven by advancements in technology and policy implementation. Japanese asset managers are adopting modern online tools and systems to strengthen the sector. There is a growing trend of socially responsible investments, and increased collaboration between local and foreign asset managers is leading to product and service innovations. Changes in laws aimed at enhancing market transparency and protecting investors are also influencing the market.
Features of the Global Third-Party Asset Management Market
Market Size Estimates: Third-party asset management market size estimation in terms of value ($B).
Trend and Forecast Analysis: Market trends (2018 to 2023) and forecast (2024 to 2030) by various segments and regions.
Segmentation Analysis: Third-party asset management market size by type, application, and region in terms of value ($B).
Regional Analysis: Third-party asset management market breakdown by North America, Europe, Asia Pacific, and Rest of the World.
Growth Opportunities: Analysis of growth opportunities in different types, applications, and regions for the third-party asset management market.
Strategic Analysis: This includes M&A, new product development, and competitive landscape of the third-party asset management market.
Analysis of competitive intensity of the industry based on Porter’s Five Forces model.
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FAQ
Q1. What is the growth forecast for third-party asset management market?
Answer: The global third-party asset management market is expected to grow with a CAGR of 6.2% from 2024 to 2030.
Q2. What are the major drivers influencing the growth of the third-party asset management market?
Answer: The major drivers for this market are increasing globalization of businesses.
Q3. What are the major segments for third-party asset management market?
Answer: The future of the third-party asset management market looks promising with opportunities in the financial institution and enterprise markets.
Q4. Who are the key third-party asset management market companies?
Answer: Some of the key third-party asset management companies are as follows:
• SmartX Advisory Solutions
• Goldman Sachs Asset Management
• Lazard Asset Management
• Kayne Anderson Rudnick
• Karpus Investment Management
Q5. Which third-party asset management market segment will be the largest in future?
Answer: Lucintel forecasts that current asset is expected to witness the highest growth over the forecast period.
Q6. In third-party asset management market, which region is expected to be the largest in next 5 years?
Answer: North America will remain the largest region over the forecast period due to strong presence of established financial institutions.
Q.7 Do we receive customization in this report?
Answer: Yes, Lucintel provides 10% customization without any additional cost.
This report answers following 11 key questions:
Q.1. What are some of the most promising, high-growth opportunities for the third-party asset management market by type (current assets, private equity, real estate, private credit, venture capital, and others), application (financial institutions, enterprise, and others), and region (North America, Europe, Asia Pacific, and the Rest of the World)?
Q.2. Which segments will grow at a faster pace and why?
Q.3. Which region will grow at a faster pace and why?
Q.4. What are the key factors affecting market dynamics? What are the key challenges and business risks in this market?
Q.5. What are the business risks and competitive threats in this market?
Q.6. What are the emerging trends in this market and the reasons behind them?
Q.7. What are some of the changing demands of customers in the market?
Q.8. What are the new developments in the market? Which companies are leading these developments?
Q.9. Who are the major players in this market? What strategic initiatives are key players pursuing for business growth?
Q.10. What are some of the competing products in this market and how big of a threat do they pose for loss of market share by material or product substitution?
Q.11. What M&A activity has occurred in the last 5 years and what has its impact been on the industry?
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