Institutional investors’ continued appetite for alternative strategies has helped drive impressive results for alternative fund administration, according to the analytics firm, eVestment.
Participating fund administrators reported alternative assets under administration
of $10.00 trillion through 2018, an increase of 18.78 percent over the $8.42 trillion submitted by the prior year’s participants.
In the survey, fund administrators emphasised the build out of front-/middle-office and data management offerings as a means to servicing more of their clients’ needs and to increasing wallet share.
Elsewhere, median respondent grew real assets under administration by 20.64 percent year-over-year while private equity and debt assets under administration rose by 11.35 percent.
Participating firms reported private equity, hedge fund, real assets, funds of funds and liquid alternatives assets under administration of $10.00 trillion, an increase of 18.78 percent year-over-year.
However, expectations for growth in fund administrators’ hedge fund books declined most year-over-year, allowing real assets to close the gap–barely ranking third.
Regionally, North America remained the number one region in terms of anticipated
business growth. However, expectations for North America-led growth did decline slightly relative to the prior survey period.
Fund administrators raised their outlook for European growth year-over-year, still ranking second overall, despite tepid economic growth and uncertainty surrounding the fate of Brexit.
eVestment said: “Despite the optimism for alternative fund administration as a whole, participants remained cognisant of the competitive nature of the business and in particular the technological arms race necessary to remain at the vanguard of the industry.”
It added: “We suspect that this will be a boon for asset managers, enabling greater operational efficiency and flexibility at reduced cost and allowing them to focus on their core value proposition of investing.”
eVestment’s 2019 Alternative Fund Administration Survey is its 19th edition of the survey to date. The analytics firm bases the publication on conversations and data submitted by 30 participating firms.
