Global assets under management
In finance, global assets under management consists of assets held by institutional investors and individual investors around the world. For example, these institutional investors include asset management firms, pension funds, endowments, foundations, sovereign wealth funds, hedge funds, and private equity funds. In contrast, individual investors include ultra high-net-worth individuals, high-net-worth individuals, the mass affluent, and other retail investors.
Assets by classification
- Around one third of private wealth is incorporated in conventional investment management.
- Many surveys systematically overestimate the global wealth pool. This is because they fail to separate out assets that are inaccessible for wealth management services
Assets by region
Assets by company
Key
- AM — Asset management firm
- FOREX — Foreign exchange reserves
- HF — Hedge fund
- MF — Mutual fund
- PEN — Pension fund
- PE — Private equity firm
- SWF — Sovereign wealth fund
- UHNWI — Ultra high-net-worth individual
Companies
Discretionary vs non-discretionary assets
Global assets under management include both discretionary and non-discretionary assets. However, there are important differences between these two types of assets. Industry standards and guidance to distinguish the two types has been established by Global Investment Performance Standards. According to GIPS, discretion refers to the extent to which an organization, for example an asset manager, is permitted to manage the assets and implement its intended investment strategy on behalf of the asset owner. More specifically, discretion refers to the extent to which assets are permitted to be managed, and intended investment strategies are permitted to be implemented, through the decisions and actions of fund managers and general partners at the asset manager.The asset owner ultimately owns the assets. For example, asset owners include institutional limited partners, such as endowments, foundations, pension funds, and sovereign wealth funds. If restrictions and limitations imposed by the asset owner significantly hinder the organization from fully implementing the intended investment strategy, the assets may be considered non-discretionary. There are degrees of discretion and not all restrictions and limitations will necessarily result in assets being considered non-discretionary. For example, if an asset owner requires that the organization avoid any tobacco-related investments, the organization would first consider if this restriction hinders the implementation of the intended strategy. If it does, the organization would likely classify these assets as non-discretionary.