Asset Management
Whilst the ‘credit crunch' is now just
over a year old, the real pain has been felt post 31 August 2008. Until
then, whilst prices were down, fund flows were fine and prospects were
positive albeit not as bullish as in the last decade.
More recently, flows have dried up with
some seeing net out flows as well as investors moving into less risky
products which present lower margin to managers. Whilst managers
may make reasonable profits in 2008, the prediction for this financial
year looks to be a challenging one.
The issues each manager faces varies with most needing to think through the following:
- Consolidation »
Just as the number of products will shrink, the number of players is likely
to fall. This might be restricted to survivors shrinking their global
footprint? Or reversing product diversification strategies and
returning to core competencies? As in banking and other industries, the
strong are likely to get stronger.
- Fund and or product rationalisation »
Especially in hedge funds, but also traditional IM. Perhaps as many as half of the world's hedge funds will close.
- Geographic reach »
Previous plans by global players to grow into markets such as
Australia may no longer be affordable. Alternatively for businesses in
positions of strength, this might bring abundant opportunities to
acquire, invest or establish joint ventures.
- Managing the cost base over the next 2 years »
If new money is limited, which areas of the business do we commit to
providing resources? Likewise, in Operations, will transaction levels
be reduced?
- Product options »
When normal and more stable market conditions return, what sort of product
will investors want? As complex as before, or something simpler?
- Regulatory developments »
Who knows what will be introduced in the US and through the world.
Even if such change is aimed at banking, it may impact hedge funds as
well as traditional investment management, administrators etc. Even if
it does not, there is potential for the institutionalisation of parts
of the market such as hedge funds.
- Risk management »
Especially in hedge fund land, but perhaps wider, managers are finding
that their risk management systems and practices were designed or
operated in a positive environment and do not operate as effectively in
the world in which we now live. Risk management is a must have, and no
longer a nice to have.
How PwC can advise your business
- Implementation of strategies to improve short term profitability
- Customer retention strategies
- Talent retention strategies
- Regulatory guidance
- Risk Management
We deliver value and advice to financial
planners, asset, funds and investment managers, superannuation
administrators and corporate and commercial institutions.
A key indicator of our reputation in the
marketplace and the competency of our teams is the strong relationship
we have established with our clients in the areas which we specialise:
- Asset Management
- REITs
- Infrastructure
- Wealth Management
- Alternatives
- Superannuation
- Internal Controls reporting
- Regulatory Reporting
Our diverse range of expertise is reflected
in our range of core services. While PwC is widely regarded for the
depth and breadth of our Assurance services, the firm offers a full
range of Tax and Advisory services to clients operating in the
Investment Management arena.
Contact our Investment Management specialists today to find out how we can help your business thrive.