Healthy market returns masked nearly flat asset growth for institutional money managers in 1995.
On an absolute basis, tax-exempt assets under management by the 500 largest money managers grew 32% in 1995, to $4.116 trillion, data from Pensions & Investments' annual directory of investment advisers show. But once adjusted for the presence of a major new player - TIAA-CREF, which was reclassified as a manager instead of as a plan sponsor - and for investment returns, asset growth is puny - only 0.5%. Among the highlights of this year's survey:
- The cash is still flowing, mainly from defined contribution plans, as it has during most of this decade. Defined contribution assets account for 25% of the total tax-exempt assets this year. If TIAA-CREF is not counted, defined contribution assets still account for a hefty 22% of the total.
- Large, multiproduct firms have become entrenched in the top tier of the industry, with State Street Global Advisors edging BZW Barclays Global Advisors for the top spot.
- While banks and insurers appeared poised last year to take over the lead in market share, investment counselors increased their market share.
- After two years of losing ground to active management, indexing staged a comeback. Enhanced indexing rallied in particular.
- Despite the misgivings of many in the industry after the freefall of the Mexican market and the continuing weakness in Japan, international assets showed double-digit growth. All of the growth was in the equity area, as international fixed income stalled in 1995.