rcblog
Since 2007, there has been a sea change in allocations between active and passive strategies among U.S. institutional tax-exempt investors. In 2007, active strategies accounted for 75.6% of assets under management. In 2023, active strategies represented only 56.2% of the total.
U.S. defined benefit plans have significantly increased their investments to real assets over the past 15 years, driven by infrastructure allocations. Investments in real assets are now $164.7 billion, up from $10.3 billion in 2006.
When Pensions & Investments started surveying outsourcing managers in 2011, assets were only $599 billion. Assets have soared over the past decade to $3.5 trillion as of March 31, 2024. There are now 13 managers with more than $100 billion in worldwide outsourcing assets.
Since 2006, few areas in asset management have grown as quickly as indexed strategies. In 2023, worldwide indexed assets from Pensions & Investments' survey was $21.1 trillion, up from $4.3 trillion in 2006.
U.S. defined contribution record keepers have steadily grown assets under administration since 2004. At the end of 2023, assets stood at $10.8 trillion, up from $2.7 trillion in 2004, growing at an annualized rate of 7.8%.
Several U.S. public defined benefit plan sponsors were very early adopters of alternative investments, such as Washington State Investment Board. Public pension plans broadly have now adopted real estate, private equity, real assets writ large. More recently many plans have added significant allocations to private credit.
The pension risk transfer market continues to see robust volume through a variety of transaction types. Pensions & Investments' pension risk transfer database has captured almost 700 specific transactions since 2010 representing more than $600 billion.
Private foundations in the U.S. represent a growing, albeit small, pool of institutional capital. Pensions & Investments compiles data from IRS 990-PF filings, which discloses foundation’s finances, including investments.
Pensions & Investments compiles defined benefit data from annual reports of companies in the S&P/TSX 60 index. In 2023, U.S. dollar assets were $130 billion, up slightly from $127 billion in 2022.
Money managers have engaged in more than 1,110 merger and acquisition deals since 2008, creating larger and larger asset management organizations. Deals have usually focused on consolidation or buying companies when the acquiring manager wants strategies in a new asset class.
