Video interview: Brutal Q3 for London-listed asset managers. Mixed bag for wealth managers

I was recently interviewed by investment information platform London South East to discuss key developments, market sweet spots, and some valuation points investors shouldn’t overlook

Topics discussed…

Interest rates

High rates and ‘risk-off’ has led to retail investors selling out of equity funds, hurting asset managers. But wealth managers with ‘cash products’ have been benefiting.

Valuations

Sector valuations have been badly beaten up. PE ratios have halved since the end of the bull market. Has the fall been overdone? Profitability, growth prospects, and balance sheets suggest it might be.

Pockets of strength and weakness

Companies with cash products, model portfolio services, ‘risk-off’ products, and areas of sustainable investing have shown relative strength. Companies with a retail investor client base have hurt more than those with an institutional client base.

Consolidation

M&A continues. The likelihood of more foreign buyers of UK companies is strong.

Sustainable investing 2.0

The bandwagon ESG phase is over. But, despite negative press of the sector, the most credible sustainable investment managers have attracted capital at higher rates than the broader market.

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