McKinsey: North American AUM Hit $43 Trillion Last Year

https://dailyalts.com/wp-content/uploads/2019/11/444px-McKinsey_7S_framework.svg-e1573057064319.png

A new report from the consulting giant shows strong growth in the money management business

A new McKinsey report puts total North American AUM at $43 trillion. This report notes that the market hit the massive figure after a 7% jump from the previous year. That said, industry profits (not-including alternative investments) declined by 3.7% to just $42.6 billion.

Inside the McKinsey AUM Report

Meanwhile, rising costs are eating into profitability, says McKinsey. The report, “Beyond the Rubicon: Asset management in an era of unrelenting change” hit the markets on Wednesday. The report states that the money management industry in North America faces a “structural transition.”

It explored six primary themes in the North American markets.

  1. First, institutions and retail clients are hungry for yield and diversification in a face of slowing economic growth and lower interest rates;
  2. Second, investors now expect “good performance at the best price” instead of the more traditional “fair price” model;
  3. Third, investors are increasingly challenging the idea of active management;
  4. Next, the market now favors distributors and intermediaries;
  5. Fifth, the growing need to cut costs and deliver – doing more with less;
  6. Finally, the important balance between scope and scale.

Highlighting Alternatives

Meanwhile, the changes in the North American market highlight the importance of alternative investments in the future.

As we noted earlier this week, Brookfield said that since 2009, approximately $6 trillion flowed into private assets. This has also resulted in an increase in the share of total investments for real assets and alternatives. The allocation has further increased from 5% in 2000 to 25% in 2018.

Ultimately, Brookfield believes a low rate world could fuel allocation to alternatives to 60% levels by 2030.

Free Industry News

Subscribe to our free newsletter for updates and news about alternatives investments.

  • This field is for validation purposes and should be left unchanged.


Shape

Latest Alternative Investment News

https://dailyalts.com/wp-content/uploads/2023/05/webimage-5e3ef5d0-aee9-4a3e-9d3e-c26109b53529.png
FinTech: Klarna’s All-In Efforts To Achieve Profitability Getting Traction
May 26, 2023     FinTech, News

Swedish fintech company Klarna achieved a significant improvement in its financial performance during the first quarter, as it halved its net loss compared to the same period last year. The…

https://dailyalts.com/wp-content/uploads/2023/05/ai-generated-g831120c83_640.jpg
Alternative Investments/AI: Euclidean Technologies Launches ETF For AI-Selected Value Stocks

Seattle-based investment advisor Euclidean Technologies Management has launched its first exchange-traded fund (ETF), the Euclidean Fundamental Value ETF (ECML US). The actively managed US equity fund utilizes artificial intelligence (AI)…

https://dailyalts.com/wp-content/uploads/2023/05/aditya-siva-6rDbvXzIVpQ-unsplash.jpg
Venture Capital: Matrix Partners Raises $550M For Its Fourth India Fund
May 26, 2023     News, Venture Capital

Matrix Partners India, a venture capital firm focused on investments in India, has announced the closure of its latest fund, securing over $550 million in commitments. This new fund from…

https://dailyalts.com/wp-content/uploads/2023/05/52747633301_b52ecbc442_c.jpg
Artificial Intelligence: AI Helps Researchers Find A Compound To Kill The Drug-Resistant A. baumannii Bacterium

Scientists at MIT and McMaster University have used artificial intelligence (AI) to identify a new antibiotic that can combat drug-resistant infections caused by Acinetobacter baumannii. The bacterium is commonly found…