Industry Analysis & Industry Trends
The UK Fund Management Activities industry is the second largest in the world and the largest in Europe. The funds under management (FUM) by the industry are expected to reach £5.9 trillion in 2015-16. Industry revenue comes predominantly from management fees, which are typically calculated as a percentage of FUM. Revenue is expected to grow at a compound annual rate of 7% over the five years through 2015-16, reaching £17.8 billion, including an increase of 4.7% in the current year. Though this is an impressive rate of growth, it is important to note that the industry began the period upon a depressed base, due to the significant declines registered during the financial crisis... purchase to read more
Industry Report - Industry Investment Chapter
The Fund Management Activities industry has a low level of capital intensity. In 2015-16, for every £1.00 spent on capital, industry operators are expected to spend £15.67 on wages.
The industry has low capital requirements but is relatively labour intensive, with wages accounting for approximately 31.3% of revenue in 2015-16. Labour expenses include the salaries and bonuses paid to staff. The average industry wage is high, reflecting the skilled nature of the work and the high demand for successful fund managers.
There are economies of scales in the industry, meaning an increase in the value of assets under management, and so management fees, may not require a comparable increase in staff numbers... purchase to read more