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For US-based asset managers seeking to grow their institutional business overseas, the challenges are many. Asset managers deciding where to focus their efforts, which investment solutions to offer and how to differentiate their brands from those of the established local firms are all critical decisions. But the one consideration that dictates all others is location—determining which countries or regions to target. And what better way to decide where to set up shop than to pinpoint where demand for new managers is greatest?
Earlier this summer, Cogent asked pension investors across Europe how many new asset managers they anticipate adding to their lineups in the next 12 months. Encouragingly, European pensions remain interested in adding new managers to their lineups. Compared with 2014, more institutional investors are likely to add at least one manager to their lineups in the coming year. Opportunity appears greatest in the Netherlands, France and the UK. Similar to the US market, $1 billion-plus institutions are primarily driving the increased interest in new manager additions in the coming year, lending fuel to the strategies of many asset managers that are focusing on the upper end of the institutional market.
Once the important decision of location is made, asset managers can then turn their attention to the specific needs and expectations of their target market. Anticipated shifts in asset allocation can provide insight into future mandates while key selection criteria used to evaluate asset managers can help inform the messaging and approach for marketing and sales efforts.
This year, when looking at consideration metrics at the individual brand level, Cogent found that several firms are gaining on the market leader, BlackRock, by strengthening their consideration potential. While BlackRock holds a strong lead in consideration for new mandates in the Nordics and Germany, the firm is bested by Fidelity Worldwide in Switzerland and is rivaled by AB and Jennison in the Netherlands. Interestingly, consideration for many challenger brands is strongest in France—the country reporting the highest likelihood of adding new managers in the coming year.
For more trends and brand-level metrics on the international institutional market, review an overview of our upcoming report, International Institutional Investor Brandscape. The report will publish this month and mirrors the content of our popular US Institutional Investor Brandscape to give subscribers a holistic view of their firm’s performance in the institutional market.