United Kingdom asset management sector reached a record £10 trillion in assets under management by the end of 2024
UK Asset Management Industry Reaches Record Highs in 2024
The UK's Investment Association (IA) reported a record Assets Under Management (AUM) of £10 trillion across the industry at the end of 2024, marking a significant milestone for the UK's asset management sector.
A key factor driving this growth is the surge in retail assets, which surpassed pension funds for the first time, accounting for 28% of the total AUM. This robust growth in retail assets reflects sustained investor interest post-pandemic, supported by strong equity returns and improving market confidence.
Another significant trend is the increase in overseas assets managed from the UK. UK-based asset management firms saw a 5% rise in funds under management (FuM) on behalf of overseas investors in 2024, indicating increasing international reliance on UK asset management services despite global market volatility.
Indexing strategies have also become increasingly popular, accounting for 35% of the UK's AUM, a record high. While active management still accounts for approximately 66% of the UK's AUM, the trend towards diversified, cost-efficient investment approaches such as index funds and exchange-traded funds (ETFs) is consistent with global asset management patterns.
The UK government and regulators are actively strengthening the asset management framework with reforms such as the creation of a UK captive reinsurance regime and proportionate authorization regimes. These regulatory advances support domiciliation of assets and reinforce the UK’s position as a leading risk transfer center.
In the real estate and infrastructure sectors, active asset management remains key to maintaining value amid higher interest rates and economic uncertainty. This active management focuses on diversification of income streams and modernization of assets to align with sustainability trends such as green energy initiatives.
The UK's status as a global centre of excellence for portfolio management has contributed to the industry's growth by retaining and attracting an increasing number of overseas clients. As a result, 69% of UK managed fund assets are in overseas domiciled funds. Most of 2024's investment fund growth came via funds domiciled in Ireland, making up over half of overseas fund assets managed from the UK.
The European ETF market saw an increase of 33% over the year, reaching more than €2.2 trillion in AUM, with assets in European domiciled ETFs rising from €1.6 trillion to €2.2 trillion. The IA sees significant opportunity to maintain asset growth in the retail space due to the UK's Financial Conduct Authority estimating that at least 75% of UK adults with over £10,000 in investible assets have their savings in cash.
In summary, the UK asset management industry in 2025 is characterized by continued expansion in retail investor assets, growing international asset management leadership, regulatory reforms promoting onshore domiciliation, a nuanced balance between active and index strategies, and a strategic focus on sustainable, value-adding asset management. The UK government's recent efforts to boost domestic capital through the Leeds Reforms signal a powerful alignment between government, regulator, and industry.
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