Mutual Fund Assets Market to Reach $101.21 Trillion, Globally, by 2027 at 11.3% CAGR: Allied Market Research

Allied Market Research published a report, titled, “Mutual Fund Assets Market by Fund Type (Equity Funds, Bond Funds, Money Market Funds, and Hybrid & Other Funds), Distribution Channel (Banks, Financial Advisors/Brokers, Direct Sellers, and Others), and Investor Type (Institutional and Individual): Global Opportunity Analysis and Industry Forecast, 2020–2027.”According to the report, the global mutual fund assets industry was pegged at $54.93 trillion in 2019, and is expected to hit $101.21 trillion by 2027, registering a CAGR of 11.3% from 2020 to 2027.

Drivers, restraints, and opportunities-

Increase in investment toward mutual fund, which enables small & large fund savers to participate in investment plans is the major factor driving the growth of the global mutual fund assets market. On the other hand, highly volatile capital market environment and high expense ratio & sales charges retrain the growth to some extent. Nevertheless, developing economies offer significant opportunities for mutual fund providers to expand & develop their existing portfolio with affordable & better returns on investments. This, in turn, has paved the way for a number of lucrative prospects in the industry.

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Covid-19 scenario-

  • The outbreak of the pandemic led to huge uncertainty in companies’ profitability and investors’ ability repay funds, thereby impacting the global market for mutual fund assets negatively.
  • Also, the economic slowdown across the world seemed to affect the market badly.

The equity funds segment to lead the trail by 2027-

Based on fund type, the equity funds segment contributed to more than half of the global mutual fund assets market share in 2019 and is anticipated to rule the roost by the end of 2027, owing to the fact that investors invest primarily in individual stocks of publicly traded companies. Moreover, factors such as diversification, systematic investments & withdrawals, and professionally money management with analyzing current & potential holdings for stock funds are propelling the segment growth. The hybrid & other funds segment, on the other hand, would manifest the fastest CAGR of 15.6% throughout the forecast period. As it involves a combination of equity & debt assets, these funds aim at striking a balance between risk and returns in order to generate income in the short run. This factor drives the segment growth.

Get detailed COVID-19 impact analysis on the Mutual Fund Assets Market

The financial advisors/brokers segment to dominate during the estimated period-

Based on distribution channel, the financial advisors/brokers segment accounted for nearly half of the global mutual fund assets market revenue in 2019 and is expected to retain its dominance till 2027. This is attributed to the fact that financial advisors provide several product portfolios toward certain investments and usually execute trades in the financial markets by proxy for their clients. Simultaneously, the direct sellers segment would portray the fastest CAGR of 13.3% from 2020 to 2027. This is because it enables shareholders to choose from among several financial alternatives and provides convenience to execute long-term investments.

North America to rule the roost-

Based on geography, North America held the major share in 2019, garnering nearly half of the global mutual fund assets market. Factors such as quantitative easing, strong consumer spending, and low unemployment propel the growth of the mutual fund assets market in this province. At the same time, Asia-Pacific would register the fastest CAGR of 13.7% during the forecast period. This is due to increased adoption of mutual funds and growing consumer’s expectations for better returns on investment in the region.  

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Frontrunners in the industry-

  • Capital Group
  • Citigroup Inc.
  • Goldman Sachs
  • JPMorgan Chase & Co.
  • BlackRock, Inc.
  • PIMCO
  • State Street Corporation
  • BNP Paribas Mutual Fund
  • Morgan Stanley
  • The Vanguard Group, Inc.

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