It’s not too early for money managers to look back with nostalgia on the solid gains they enjoyed in 2021, after inflationary pressures not seen for decades emerged this year to end an era where equity managers have been able to think of the U.S. Federal Reserve as a friend.
Pensions & Investments’ latest annual survey of the largest money managers found worldwide institutional assets overseen by roughly 450 managers around the globe rising 6.3% last year to $59.38 trillion, and 50.5% over the five years through Dec. 31.
U.S. institutional tax-exempt assets managed internally, meanwhile, jumped 11.2% for the year to $20.06 trillion, lifting the gain for the past five years to 46%.
For money managers around the world, the latest year was “really bullish,” driven by hopes for a continued recovery from COVID-19 lockdowns, said Fabrice Chemouny, Hong Kong-based head of Asia-Pacific at Natixis Investment Managers.
It was essentially equity-driven, with the flood of liquidity central banks unleashed to combat the COVID-19 crisis from early 2020 crushing sovereign bond yields and making the acronym TINA — “there is no alternative” to equities — part of the vernacular, Mr. Chemouny said. For money managers last year, “all the planets were aligned,” he said.
But then the universe tended to disorder.