Published by Asia Asset Management – 24th Jan 2019
The Asia Pacific asset and wealth management industry will grow faster than in other regions with assets under management (AUM) expected to almost double to US$29.6 trillion in 2025 from $15.1 trillion in 2017, PricewaterhouseCoopers (PwC) predicts in a new report.
The growth will be driven mainly by retail mutual funds and sovereign wealth funds, according to the report, Asset and Wealth Management 2025 – The Asian Awakening, published on January 22.
Assets of retail mutual funds are forecast to more than double to $11.9 trillion in 2025 from $5.5 trillion in 2017. Assets of sovereign wealth funds are expected to double to $5.7 trillion from $2.8 trillion over the same period.
Passive and alternative investment strategies will likely become more popular and, together, account for more than 40% of assets in Asia Pacific, PwC says.
It predicts passive strategies to have a 17.1% share of total Asia Pacific AUM in 2025, up from 12.1% in 2017, and the share of alternative strategies to increase to 23.5% from 18.9%.
“Passive strategies are establishing themselves in the region, with the Bank of Japan a strong purchaser of exchange-traded funds tracking Japanese indices, and other investors allocating larger amounts to passive strategies,” the report says.
As for the forecast expansion of alternatives, the “staggering increase is largely due to the expected boom in demand for infrastructure and private equity assets”, it says.
