According to the latest study by the European Fund and Asset Management Association (EFAMA) the prevailing trends of previous years have continued among European asset managers.

Thanks to the recovery on the stock markets in the first three quarters of 2024, total assets under management (AuM) in Europe are likely to have reached a new record of €32.7 trillion by the end of September 2024, according to the European industry association's 2024 annual study. This would be an increase of 9.0 percent since the beginning of the year.

At the end of 2023, AuM stood at €30.0 trillion, an increase of 8.3 percent on the previous year. Due to the weakness on the stock markets, AuM had fallen by around 14 percent in 2022.

(Graphic: EFAMA)

The European market is strongly characterized by its concentration in the financial centers of London, Paris, Frankfurt and Zurich, the association states. In Europe, asset management activities are concentrated in six countries, which account for almost 85 percent of asset management activities. The largest asset management location with a share of 35 percent at the end of 2023 was the UK, followed by France with 16 percent.

Switzerland in Third Place

Switzerland was able to defend third place with €3.36 quadrillion or 11 percent market share, ahead of Germany (€2.99 quadrillion, 10 percent market share). It was followed by the Netherlands and Italy.

In addition to the importance of the financial centers, the size of the domestic savings markets is also seen as a decisive factor.

(Graphic: EFAMA)

Data from 2023 highlights prevailing industry trends, as outlined by EFAMA. For instance, the share of investment funds in total assets under management (AuM) has steadily increased over the past decade, driven by higher equity allocation compared to discretionary mandates. In 2023, the share of investment funds grew by an additional 0.3 percentage points.

Share of Private Customers Grow

The trend of a growing share of private customers has also continued. Their share of total AuM rose from 26 percent in 2019 to 30.8 percent at the end of 2023.

(Graphic: EFAMA)

Greater Appetite

The growth is explained by European private investors' increased appetite for investments. They are investing a larger proportion of their assets in funds. Exchange-traded funds (ETFs) are increasingly the preferred investment instrument for European households.

European asset management has a significant share in the financing of the European economy. Asset managers would have managed €6.4 trillion in bonds and around €3.0 trillion in shares of EU companies and issuers at the end of 2023. This equates to shares of 28 percent and 27 percent respectively.