October 26, 2021 | Stamford, CT — In a year of surging capital market inflows and soaring equity market valuations, the biggest challenge for many asset managers was getting their funds to stand out in a crowded field of attractive products on retail distribution platforms. 

In both Europe and Asia, fund distributors say Allianz Global Investors rose to that challenge best, earning the firm the title of 2021 Greenwich Quality Leader in Intermediary Fund Distribution.

Asset managers in both regions last year succeeded in capturing the attention and assets of retail investors on fund platforms in part by offering specialty products outside traditional fund categories like global equities or European or Asian fixed income. In addition, distributors are showing a strong preference for asset managers who have invested the time and resources required to provide strong digital services and support. 

“Asset managers working to roll out mobile interfaces and AI tools would be better served by focusing on simple portals and interfaces that make it easy for distributors and investors to connect and get the information they need,” says Mark Buckley, Coalition Greenwich Relationship Director and co-author of Demand Grows for Thematic, ESG-Compliant Funds on Retail Distribution Platforms.

ESG: Prerequisite for Platform Placement
Sixty-three percent of fund distributors in Europe and 39% in Asia say they require all managers on their platforms to have a clearly articulated ESG policy. In both regions, approximately 80% of fund distributors expect to have such a requirement in place by 2026. 

“Although it remains to be seen if ESG will actually attract the interest and assets of retail investors, distributors are leaving no room for ambiguity: Asset managers who fail to integrate ESG will not be allowed on their platforms,” says Parijat Banerjee, Coalition Greenwich Relationship Director and report co-author.

Europe: Fund Platforms Project Strong Inflows Across Asset Classes
Looking ahead to 2022, European fund distributors expect to see significant retail inflows across virtually all asset classes. In equities, distributors expect inflows to remain strong in almost every category. Expectations are similar for alternatives and private assets, where demand is expected to be strongest for infrastructure and private equity. 

This is also true in certain fixed-income categories. For example, distributors are expecting strong inflows for emerging markets and Asian debt, and positive inflows in other products with the potential to deliver relatively attractive yields. At the opposite end of the spectrum, distributors expect retail investors to continue reducing exposure to government bonds and investment-grade debt.  

Asia: Distributors Expect More “Risk On” from Retail
Asian fund distributors expect investors on their platforms to remain bullish in the year ahead. Distributors are projecting strong retail inflows into every equity category except European equities, with the strongest demand expected for Asian, international/global and U.S. equities. 

Distributors also expect to see increased inflows into alternative categories like infrastructure, and to a lesser extent private equity and real estate. Flows into multi-asset funds are projected to remain robust.