Larger buy-side firms more optimistic on growth prospects

Global survey finds 84% of large buy-side firms predict growth in annual revenues.

Larger asset managers are more optimistic on growth prospects over the next three years, compared to their smaller counterparts.

A poll of 155 global buy-side industry individuals - conducted by SimCorp earlier this year - found 84% of large asset management firms expect annual revenue growth of 6% or more.

However, only 36% of asset management firms that are considered small - less than 200 employees - indicate the same.

“Larger respondents expect to significantly exceed the 6% assets under management growth projection for the market as a whole,” the report said.

SimCorp explained if the prediction holds true, then it’s a continuation of the “big getting bigger” pattern that has been in place since the global financial crisis.

The report highlighted that assets under management and revenue growth came to a standstill in 2015, particularly in the institutional sector.

David Beveridge, senior product marketing manager at SimCorp explained an improved IT infrastructure could be the key to larger buy-side firms realising this projected growth.

“[Larger investment firms] should take a critical look at their IT infrastructure, ensuring it enables them to operate efficiently, scale their business and make informed investment decisions,” he said.