What $128 Trillion in AUM Doesn't Tell You: 7 Hard Truths for Asset Managers in 2026

⦿ Executive Snapshot

What: Global assets under management (AUM) reached a record $128 trillion in 2024, with projections of an additional $9.6 trillion by 2035.
Who: Key players include asset management firms and financial analysts from BCG, McKinsey, Deloitte, Accenture, and Moody's.
Why it matters: The asset management landscape is evolving, with significant disparities emerging between top-performing firms and their mid-sized counterparts.

Firms with over $2 trillion in AUM maintain margins around 45%, while those below $500 billion are at 36%, and mid-sized firms struggle at just 26%.
Passive funds are significantly cheaper, charging up to 60% less than active funds, with specialist buyout funds achieving pooled IRRs of 17% compared to 13% for generalists.
Tokenised real-world assets are expected to exceed $100 billion by 2026, driven by regulatory clarity from the GENIUS Act and the Digital Asset Market Clarity Act.
More than half of global asset managers have upgraded their cybersecurity frameworks amid rising cyber risks associated with AI.
The demand for sustainable investments continues to grow, particularly in the Asia-Pacific region, with 64% of APAC managers planning new sustainable product launches this year.

The asset management industry is experiencing a widening gap between well-positioned firms and those struggling to adapt to market changes, highlighting the need for strategic operational choices.
The rise of tokenisation and advancements in AI signify a shift in the industry, moving from traditional asset management practices to more innovative and technology-driven approaches.

Firms that leverage AI as a core strategy and embrace tokenisation will likely outperform their peers, generating higher profits and operational efficiencies.
The maturing ESG landscape indicates a shift towards more impactful investment strategies, prioritizing the decarbonisation of high-emission companies.

Regulatory challenges and the need for robust cybersecurity frameworks pose significant risks for asset managers navigating the evolving landscape of AI and tokenisation.
The geopolitical landscape's instability could disrupt investment flows and operational strategies if firms do not adapt their risk frameworks accordingly.

Upcoming regulatory developments regarding tokenisation and digital asset management will be critical in shaping the future of asset management.
Monitoring the growth of private markets and their revenue contributions will provide insights into the industry's evolving dynamics and opportunities for asset managers.