Despite global economic challenges, the asset investment world is expected to reach $132 trillion by 2027 which will be up from $106 trillion in 2024. This marks a compound annual growth rate (CAGR) of 7.6%, a significant increase. Considering U.S. trade-offs, ongoing conflicts in the Middle East and Ukraine, and persistent inflationary pressures, Broadridge has revised its projections.
Industry growth defies geopolitical headwinds
These factors may slow the sector’s growth, however, they are not expected to derail its expansion. Nabeel Ansari, the Senior Director of Global Growth Solutions at Broadridge stated that intensifying competition, distributor consolidation, and the rise of passive investment vehicles are key drivers of this trend.
“Fee compression remains a global reality: while absolute revenues are set to increase, margins are continuing to face structural pressure.”
Asset managers are set to see their global revenue go up from $368 billion in 2024 to $443 billion by 2027, this will be a 7% boost.
“This trend favours managers with the investment platforms and distribution capabilities to scale participation.”
This growth will, however, be uneven across product lines. Traditional public-market active equity strategies are facing headwinds, with fee margins continuing to decline. Broadridge forecasts a -0.8% Compound Annual Growth Rate (CAGR) for active equities over the next three years.
Shifting revenue streams and product preferences
In contrast, fixed income is emerging as a bright spot for active managers. With interest rates elevated and market volatility persisting, investors are turning to active strategies for greater tactical flexibility and alpha generation. Fixed income allocations are expected to grow at a 2.5% CAGR from 2024 to 2027.
Private markets also represent a major opportunity. Governments and banks are trying to make private investments more accessible; asset managers with big platforms and good distribution are set to gain. Asset managers with robust investment platforms and distribution capabilities are well-positioned to scale participation, Ansari noted.
One of the most transformative shifts in the industry is the rise of retail investors. By 2027, retail assets are projected to account for 50% of the global asset pool, driven by changing demographics, digital distribution platforms, and product innovation tailored to individual investors.
Pointing to the increasing accessibility of investment tools and the growing appetite for personalized financial solutions, Ansari stated that retail assets are “propelled by powerful tailwinds.” This shift is expected that finance solutions are set to see their global revenue jump from $368 billion in 2024 to $443 billion by 2027, representing a 7% boost driven by AI-enhanced work efficiency.
“Fee compression remains a global reality: while absolute revenues are set to increase, margins continue to face structural pressure.”
Broadridge’s report underscores the importance of adapting to structural shifts in the industry. Firms that embrace digital transformation, diversify product offerings, and build resilient global platforms will be best positioned to thrive in the years ahead
Outlook: growth with caution
The growth path is expected to vary significantly across different product lines, such as traditional public-market active equity strategies and fixed income allocations, prioritizing cost efficiency and risk-adjusted returns, leading to a surge in passive fund flows. While active management remains important, especially in fixed income and alternatives, the market is increasingly moving towards private markets which offer a considerable avenue for development.
Governments and banks are making it easier for people to invest privately, which in turn helps asset managers with large networks to gain advantages. By 2027, it is anticipated that retail assets will constitute 50% of the global asset pool, a shift influenced by evolving demographics, improvements in digital distribution platforms, and innovative products designed for individual investors.
As a result, platforms will be best positioned to thrive in the years ahead. In short, the investment management industry is entering a new era—one defined by asset growth and strategic reinvention.