Big gains for small managers
CHANGING THE NATURE OF THE MARKET
Between end September 2014 and the same time this year, the money invested in SA collective investment schemes grew from R1.7 trillion to R2.31 trillion. This includes all unit trusts, exchange-traded funds and regulated hedge funds.
Overall, this increase in assets under management (AUM) represents growth of 36% for the industry. Some asset managers have seen a lot more of this than others.
At the top end of the market, Coronation was the largest manager in this space at September 30, 2014. It has fallen behind Allan R221.8bn R218.3bn Gray in the subsequent three years. Of the other big managers, Sanlam and Nedgroup Investments have shown the greatest percentage growth (see the table).
The bottom five managers all grew their AUM quicker than those larger than them. In absolute numbers, Allan Gray and Sanlam saw similar increases, but because Sanlam is much smaller, it recorded much faster growth. R250.7bn R278.6bn
Note, Sanlam and Nedgroup are the only two managers on this list that grew their AUM faster than the industry average. This shows there’s a lot of growth happening elsewhere, among small and mid-sized managers.
Among the latter, Discovery more than doubled its AUM over these three years, from R19.5 billion to R40.9 billion and PSG grew from R23.2 billion to R42.7 billion.
However, it’s among the boutiques where the really rapid growth has happened: both among small managers with their own management companies (mancos), and firms that white-label or co-brand funds for third party managers.
Boutique Collective Investments (BCI), which predominantly runs white-labelled funds, has grown into the tenth largest manco in the country. At September 30 this year, it had R85.5 billion in AUM, up from R22.8 billion three years ago.
Some of other mancos in the white-label space have also seen substantial growth. The co-branded assets on Prescient’s management licence have grown from R12.9 billion three years ago to R33.2 billion. Sanlam’s third party assets jumped from R5.2 billion to R13.6 billion.
These may not seem like huge numbers, but taken together, boutique managers are starting to command a reasonable chunk of the local market. About R210 billion is now managed by independent boutiques – a total market share of just under 10%.