2008 Toll: $10T Less in Managed Assets

July 8, 2009 (PLANSPONSOR.com) - The economic crisis erased just under $10 trillion in professionally managed assets in 2008, with the bulk of the decline seen in the final quarter, according to Cerulli Associates.

A Cerulli news release said that while it took three years to add $10 trillion in assets between 2005 and 2007, it took less than six months to lose most of that money. Cerulli said it could take the better part of the next five years to regain those assets.

“As with all these things, there is a real danger of getting too bearish in one’s sentiment, but it wouldn’t be out of place to suggest that several of the old shibboleths of the asset management industry have been washed away,” said Shiv Taneja, managing director at Cerulli, in the news release.

“Even if the emerging markets see a more immediate recovery than the more developed markets, the one lesson that the global asset management industry has learned is that unless all is well at the home office, opportunistic and strategic expansion in far-flung markets can, and will, suffer,” Cerulli commented further in the announcement.

The firm said it has revised downward its five-year growth forecasts from 7.9% to 5.5%. This suggests that global assets under management will grow to $56.5 trillion by the end of 2013, marginally higher than the $53 trillion at the end of 2007.