IA reports show UK investment management expansion, but pension asset share shrinks
An early insights report published by the Investment Association (IA) with data as of 31 December 2024 shows that the UK investment management industry reached a record £10.0trn in assets under management (AUM) in 2024, marking a 10% increase from the previous year. The IA indicates that this growth reflects strong market performance, improved economic conditions, and a rise in assets managed from the UK for overseas investors. UK funds under management (FUM) rose by 5% to £1.49trn, indicating renewed investor confidence and positive market returns. A notable shift occurred in the composition of AUM, with retail investor assets rising to 28%, surpassing pension assets for the first time, which fell to 27%. This change highlights growing interest in retail investing since the pandemic and aligns with government efforts to encourage investment over cash savings. However, pension assets have declined significantly from their 2018 peak of 45%, driven in part by the winding down of defined benefit schemes, fully funded transfers to insurers, and the lingering effects of the 2022 gilt crisis.