Money managers' U.S. internally managed institutional tax-exempt assets swung 6% higher in 2004, to $8.78 trillion, according to Pensions & Investments' annual survey.
The appreciation, however, pales in comparison to the overall market performance. On a market-adjusted basis, the largest 500 managers' U.S. internally managed institutional tax-exempt assets lost nearly 2%.
(The Russell 3000 stock index jumped 11.95% in 2004 and the Morgan Stanley Capital International Europe Australasia Far East index rose 20.25%. Also during the year, the Citigroup Broad Investment Grade bond index rose 4.48% and the Citigroup World Government Bond index rose 12.14%.)
Worldwide institutional assets under management by the 760 managers surveyed jumped 14.7% to $19.07 trillion from $16.62 trillion last year. Managers' total worldwide assets jumped 15% to $28.73 trillion from $24.9 trillion in 2003.
Consultants cited several factors shaping 2004's performance. Looking at the big picture, they said, the year saw money managers running their businesses against the backdrop of presidential election uncertainty as well as rising interest rates and oil prices.
In a year that the integrated oils sector of the Russell 1000 index was up 28.5%, "that (presents) a big headwind for a lot of managers," said Mark Eibel, head of U.S. equity manager research at Russell Investment Group, Tacoma, Wash.