Investment outsourcing firms have a rosy view on growth in the industry, but a recent analysis by Casey Quirk & Associates LLC sets lowered expectations.
An update of a report by the consulting firm estimates the investment outsourcing market will grow to $320 billion by 2012 and $410 billion by 2014; in 2008, the report had estimated the business would reach $510 billion by 2010.
Kevin Quirk, founding partner and principal with Casey Quirk in Darien, Conn., attributed the lowered projection to the world financial crisis.
Mr. Quirk said in a telephone interview that difficult capital markets have helped drive the investment outsourcing business. A growing interest in alternatives, which investment committees often have little experience in managing, also has generated interest in outsourcing, he said.
“I think the long-term trend (toward outsourcing) will continue,” he said. “The financial crisis and volatility in 2008 and 2009 and (the recent single-day ‘flash crash' on May 6increased the demand for outsourcing.”