Mood of the month

The European fund buyer’s mood index has fallen to to 57.4 points since July, entering neutral waters after a first half of the year spent in positive territory. This plunge was mainly driven by Italian fund buyers as a result of the local political situation: only 26% of them say they are optimistic for the next 12 months. By contrast, Austrian and Swedish fund selectors remain positive about fund industry prospects with 60% and 45.5% stating an optimistic view, respectively.

Distributor commentary

For the week ending 5th October 2018
  • “I think that one of the most important drivers of change will be an increase in central bank interest rates. That will lead to a reduction in the use of funds for fixed-income allocations, and greater use of direct investment for that purpose. From a personal, perspective this rise in interest rates will mean, in the sphere in which I operate, the chance to choose from a much larger range of products opening up the possibility of much greater margins in terms of capital gain.”

    Drivers of change
    Switzerland, Private client portfolios - Discretionary
  • “We are seeing a lot of news about real estate strategies, in particular with real estate investment schemes. Even though we do not use these funds, we can see that this market segment is moving a lot. SRI is also commanding an increasingly important stake, and we are seeing the arrival of new players as a result of due diligence obligations for institutional investors. In tandem, private equity seems to be moving a lot and attracting a lot of capital.”

    Innovative behaviour in fund industry
    France, Private client portfolios - Discretionary
  • “I expect the fund managers to act flexibly in rapidly and profoundly changing markets and environments. Volatility will increase. The changing regulatory requirements, especially in Europe, will create difficulties and challenges for the fund industry. They will particularly lead to increasing transparency and lower management costs for customers.”

    Drivers of change
    Austria, Independent financial advice / Intermediary services
  • “If the asset managers aren’t proposing anything innovative the banks will bring volumes in house for reasons of transparency, cost, liquidity, and process management. Increasingly, we will use third party funds when seeking specific themes or absolute performance. The regulation will lead cost reductions, which will eliminate a part of the industry that earns fees on benchmarked funds.”

    Drivers of change
    Switzerland, Private client portfolios - Discretionary
  • “I think that asset managers are continually launching new products and that they are good at adapting to change. I've noticed an increase in the number of SRI-orientated funds within fund houses' product ranges, to the extent that SRI is turning into a trend here. In addition, I've noticed that there's a lot of competition coming from ETFs and passive investments generally, and I think that unless active asset managers address that competitive threat, passives are going to win a lot of market share from the active-management sphere.”

    Innovative behaviour in fund industry
    Spain, Funds of funds management
  • “My general impression is that things are a bit static on that front at present. Asset managers are just recycling old ideas and marketing them as if they were new. The 'new' thematic funds that we are hearing so much about just now are, essentially, nothing more than what used to be called sector funds. All that has changed is the name.”

    Innovative behaviour in fund industry
    Italy, Funds of funds management

The shifting sands of distribution

11 July 2018
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By Fiona Maciver

Six months on from the implementation of Mifid 2 and Priips, Europe’s new distribution landscape is slowly evolving as business models adapt to the regulatory developments. Meanwhile, the blurring of the boundaries between asset managers and distributors continues, with both sides moving into new territories and adopting vertically integrated models, resulting in the emergence of the ‘distributor-manager.

▪ Changes

Translate perception into business.

Fund Buyer Focus offers reporting and consulting services which provide third party retail fund suppliers with detailed information about how the major fund distributors perceive them and how this perception translates into business.

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