UK financial intermediaries highlight key asset classes for market growth potential

Brand recall among financial intermediaries shows where managers could gain market share 

Key points: 

• For Fundamental Media’s Global Brand Survey, UK financial intermediaries were asked to recall asset management brands they associate with different asset classes and management styles. These responses provided us with insights on market competitiveness for each asset class and management style prompted. 
• Some of the most competitive asset classes and management styles in the UK are alternatives, multi-asset, smart beta and absolute return, while competition in passive management and ESG is low. 
• Although some asset classes are more competitive than others, offering asset managers the opportunity to gain market share by differentiating themselves from their competitors, not all asset classes are in vogue. 

Alternatives, smart beta and absolute return are some of the most competitive asset classes in the UK asset management space, while competition in passive management and ETFs is relatively low, research by Fundamental Media shows. 

For the 2024 Global Brand Survey, Fundamental Media surveyed 159 financial intermediaries in the UK from June to September 2023. One of the questions focused on unprompted brand recall, revealing which brands are top of mind for intermediaries for different asset classes and management styles. These responses provided us with insights on market competitiveness for each asset class and management style prompted.  

Without being prompted, respondents mentioned 198 different companies across the 15 asset classes and management styles. But despite the high number of companies mentioned in each asset class or management style, some had a handful of brands which received a much larger number of mentions compared to the average, while others had a more even spread of mentions across more companies.  

To better understand the competitiveness of each asset class and management style, we looked at the standard deviation in the number of mentions. A low standard deviation in the number of mentions within an asset class or management style indicates that the mentions are more evenly distributed among the different brands within that category. This suggests a more competitive environment because no single brand overwhelmingly dominates the market. Instead, many brands are receiving similar levels of attention, implying that none have a significantly larger market share or recognition than the others. 

In contrast, a high standard deviation means that the mentions are more unevenly distributed, with a few brands receiving many more mentions than the others. This indicates less competition, as the market is dominated by a small number of leading brands. 

In conclusion, in more competitive asset classes and management styles, companies who put much effort into increasing their visibility might be able to gain market share and move up through the ranking faster compared to less competitive asset classes and management styles, where more effort and time might be needed to reduce the gap with the most established brands. 

Within the prompted asset classes among UK intermediaries, alternatives, UK equities and multi-asset saw the largest variety of companies mentioned, while only 37 different companies were recalled in real estate. However, when looking at the variability in the number of mentions within each asset class, alternatives, multi-asset and real estate showed the lowest standard deviation, suggesting that these asset classes are more competitive than the others. On the other hand, global equities and European equities, while seeing more than 40 unique brands mentioned, had a much higher leaning towards a smaller number of leading brands. 

Although some asset classes are more competitive than others, offering asset managers the opportunity to gain market share by differentiating themselves from their competitors, not all asset classes are in vogue. 

When asked which asset classes they expect to increase their clients’ exposure to over the next 12 months, 45% of UK financial intermediaries indicated they plan an increase in global equities while 7% plans a decrease. An increase is also expected for emerging market equities (38% plan an increase vs 12% who plan a decrease) and multi-asset (27% increase vs 11% decrease). On the other hand, 44% of intermediaries plan to decrease exposure to real estate, while only 8% plans to increase it. 

When looking at the management styles, active management had the largest number of unique asset management brands mentioned, while UK intermediaries only mentioned 20 different ETF brands and 23 brands in passive management. Passive management and ETFs are also by far the least competitive, while the other management styles are showing a much healthier level of competitiveness, especially smart beta and absolute return.  

The figures on the demand for specific management styles shows that UK intermediaries are most interested in ESG, where 32% plan an increase and 11% a decrease, and active management, with 32% planning an increase and 14% expecting to decrease exposure. Absolute return will most likely see the least interest over the coming year, with 24% planning a decrease and only 5% an increase. 

For access to the full GBS report, visit our dedicated Global Brand Survey page.