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Money Managers See Improved Year in 2010
The 10% increase
generated aggregate revenues of $34 billion. As financial markets recovered from the lows of March
2009, average assets under management for full year 2010 rose 42% from
2009 levels, leading to higher fee revenue for 18 of the 19 managers
included in the annual study.
Operating expenses rose 25% in
2010, as companies once again began to invest in personnel and
technology. However, these higher costs were eclipsed by a 35% increase
in operating revenue, leading to an aggregate 4% increase in pre-tax
operating margins.
The report says the continuing focus on fees
(including the industry-wide transition to lowest-fee share classes),
costs for U.S. and global distribution, and investments in technology,
compliance, and talent continue to challenge investment managers. A
weakening stock market and persistent near-zero short term interest
rates could pressure many investment management profits and margins.
Strategic Insight research clients can access the full report at http://www.sionline.com/research/subscriber_insights/789.pdf.
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