UK Collective Investments 2008

The mutual funds sector faces its own challenges since the market upheaval of summer 2007. Taking account of new regulation and the threat of product substitutes such as ETFs, this report examines market developments and competitor and investor dynamics over the last year, and presents the prospects for 2008-12.

Report Highlights
Exchange-traded funds (ETFs) are gradually assuming a more prominent place in the UK's collective investments landscape. Though still a fraction of the mutual funds market, growth in UK ETF assets outstripped growth in mutual funds in 2007.

Since 2005, retail investors in the UK have allocated a growing percentage of their investments to unit trusts, OEICs and investment trusts. By 2007, these mutual funds accounted for just over one quarter of their portfolios, up from 20% in 2003.

Younger adults aged 18-29 tend to use a variety of channels for investing. While they are most likely to invest at their bank or building society (34%), nearly one-quarter of these clients has also approached an IFA, 22% invests directly through an investment company and 19% has also invested through an insurer.
[Studien Infos ausblenden]

Overview 1
Catalyst 1
Summary 1
Methodology 1
Executive Summary 2
Despite regulatory and financial market challenges, there is broad scope to increase penetration in the UK collective investments market 2
Key issue: Mutual funds vs ETFs - In the short term, mutual funds will hold their own against ETFs, but the competitive threat is increasing 2
Adverse market conditions and regulatory interventions are likely to deter mutual fund investors 2
UK penetration remains below 5%, with higher earners and the elderly more likely to hold collective investments 3
IFAs remain a popular source for advice and service on collective investments 3
Despite contraction in the number of providers, retail investors have access to an expanded range of funds 3
Table of Contents 4
Table of figures 5
Table of tables 6
Special Feature: Mutual Funds vs ETFs - The Battle for Retail Investors 7
In the short term, mutual funds will hold their own against ETFs, but the competitive threat is increasing 7
ETFs present a minor, but growing threat to conventional mutual funds 7
Demand for ETFs is growing because they offer advantages of cost, trading flexibility and market access 8
UK and EU legislation is also facilitating growth in the ETF market 8
Faced with inevitable growth in the ETF market, conventional fund managers can play offence or defence to shore up their revenue and profit 8
Offering ETFs is not the only option 9
ETFs do not offer cost advantages to all investors 9
For mass market investors, the ability to trade throughout the day may prove less alluring 10
Fund managers should communicate their commitment to the investment objective and strategy that investors have bought into 10
Building and emphasizing corporate investment expertise minimizes the threat of manager defection 10
Improving transparency through more regular, comprehensive reporting will help investors and advisors to formulate their own judgements about a fund manager's integrity 11
The best defensive position will be completely transparent 11
Market Context 12
Adverse market conditions and regulatory interventions are likely to deter mutual fund investors 12
Mutual funds account for a growing percentage of retail investment assets 12
Retail investors in the UK are holding £421 million worth of collective investments 13
Poor performance has lowered year-on-year growth 13
By 2012, investors will have seen growth of just 10% in their mutual fund portfolios 14
Regulatory developments affecting fund management and distribution will threaten mutual fund managers' revenues and profit 16
The FSA wants improved due diligence on mutual funds 16
Proposed changes to existing retail distribution models will also increase operating costs and open the market to greater competition from substitutes 17
Other government interventions may help to boost the UK asset management industry 18
Customers 19
UK penetration remains below 5%, with higher earners and the elderly more likely to hold collective investments 19
Retail investors are using mutual funds to access the equity markets 19
The majority of unit trusts and OEICs are held outside of ISAs and PEPs 19
Approximately 3% of adults in the UK have unit trusts, with the highest penetration among those over age 60 21
Distribution Channels 24
IFAs remain a popular source for advice and service on collective investments 24
Investors buy mutual funds primarily through IFAs 24
Tied agents or sales forces account for close to one-third of ISA unit trusts and OEIC sales 24
Clients prefer face-to-face service and advice on their investments 25
Mass affluent investors are most likely to go directly to investment companies or buy directly through fund supermarkets 27
Sales efforts should focus most on advisor training and support, since investors prefer to speak to someone about their investment options 28
Wealthier investors are also open to using the financial press to gather information on investments 29
Men are more likely to do-it-themselves than women 30
Competitors 32
Despite contraction in the number of providers, retail investors have access to an expanded range of funds 32
Industry consolidation continued into 2007 32
The top 10 investment trust managers account for 45% of the market, in terms of assets under management 33
45% of OEIC, PEP and ISA assets are attributed to the top 10 fund managers 34
APPENDIX 35
Data 35
Definitions 50
Independent Financial Advisors (IFAs) 50
Gross Retail Sales 50
Net Sales 50
Share repurchases 50
Deposits 50
Investment trusts 50
ISA 51
OEICs 51
Unit trusts 51
Personal Equity Plan 52
Methodology 52
Datamonitor's UK Savings and Investments Database 52
Flows Methodology 52
Market Share Methodology 52
Ipsos MORI data 53
Sample design 53
Bibliography 53
Further reading 54
Ask the analyst 54
Datamonitor consulting 54
Disclaimer 54
[Inhaltsverzeichnis ausblenden]

Table 1: Global Industrial Gases Market Value: $ billion, 2003-2007 26
Table 2: Global Industrial Gases Market Segmentation I: % Share, by Value, 2007 27
Table 3: Global Industrial Gases Market Segmentation II: % Share, by Value, 2007 28
Table 4: Global Industrial Gases Market Share: % Share, by Value, 2007 29
Table 5: Global Industrial Gases Market Value Forecast: $ billion, 2007-2012 37
Table 6: Asia-Pacific Industrial Gases Market Value: $ billion, 2003-2007 39
Table 7: Asia-Pacific Industrial Gases Market Segmentation I: % Share, by Value, 2007 40
Table 8: Asia-Pacific Industrial Gases Market Segmentation II: % Share, by Value, 2007 41
Table 9: Asia-Pacific Industrial Gases Market Value Forecast: $ billion, 2007-2012 49
Table 10: Europe Industrial Gases Market Value: $ billion, 2003-2007 51
Table 11: Europe Industrial Gases Market Segmentation I: % Share, by Value, 2007 52
Table 12: Europe Industrial Gases Market Segmentation II: % Share, by Value, 2007 53
Table 13: Europe Industrial Gases Market Value Forecast: $ billion, 2007-2012 61
Table 14: Europe Exchange Rate, 2003-2007 62
Table 15: Belgium Industrial Gases Market Value: $ million, 2003-2007 64
Table 16: Belgium Industrial Gases Market Segmentation I: % Share, by Value, 2007 65
Table 17: Belgium Industrial Gases Market Segmentation II: % Share, by Value, 2007 66
Table 18: Belgium Industrial Gases Market Value Forecast: $ million, 2007-2012 74
Table 19: Canada Industrial Gases Market Value: $ million, 2003-2007 76
Table 20: Canada Industrial Gases Market Segmentation I: % Share, by Value, 2007 77
Table 21: Canada Industrial Gases Market Segmentation II: % Share, by Value, 2007 78
Table 22: Canada Industrial Gases Market Value Forecast: $ million, 2007-2012 86
Table 23: China Industrial Gases Market Value: $ billion, 2003-2007 88
Table 24: China Industrial Gases Market Segmentation I: % Share, by Value, 2007 89
Table 25: China Industrial Gases Market Segmentation II: % Share, by Value, 2007 90
Table 26: China Industrial Gases Market Value Forecast: $ billion, 2007-2012 98
Table 27: China Size of Population (million) , 2003-2007 99
Table 28: China GDP (Constant 2000 Prices, $ billion), 2003-2007 99
Table 29: China Inflation, 2003-2007 99
Table 30: China Exchange Rate, 2003 100
Table 31: France Industrial Gases Market Value: $ billion, 2003-2007 102
Table 32: France Industrial Gases Market Segmentation I: % Share, by Value, 2007 103
Table 33: France Industrial Gases Market Segmentation II: % Share, by Value, 2007 104
Table 34: France Industrial Gases Market Value Forecast: $ billion, 2007-2012 113
Table 35: France Size of Population (million) , 2003-2007 114
Table 36: France GDP (Constant 2000 Prices, $ billion), 2003-2007 114
Table 37: France Inflation, 2003-2007 114
Table 38: France Exchange Rate, 2003 115
Table 39: Germany Industrial Gases Market Value: $ billion, 2003-2007 117
Table 40: Germany Industrial Gases Market Segmentation I: % Share, by Value, 2007 118
Table 41: Germany Industrial Gases Market Segmentation II: % Share, by Value, 2007 119
Table 42: Germany Industrial Gases Market Value Forecast: $ billion, 2007-2012 126
Table 43: Germany Size of Population (million) , 2003-2007 127
Table 44: Germany GDP (Constant 2000 Prices, $ billion), 2003-2007 127
Table 45: Germany Inflation, 2003-2007 127
Table 46: Germany Exchange Rate, 2003 128
Table 47: Italy Industrial Gases Market Value: $ billion, 2003-2007 130
Table 48: Italy Industrial Gases Market Segmentation I: % Share, by Value, 2007 131
Table 49: Italy Industrial Gases Market Segmentation II: % Share, by Value, 2007 132
Table 50: Italy Industrial Gases Market Value Forecast: $ billion, 2007-2012 140
Table 51: Italy Size of Population (million) , 2003-2007 141
Table 52: Italy GDP (Constant 2000 Prices, $ billion), 2003-2007 141
Table 53: Italy Inflation, 2003-2007 141
Table 54: Italy Exchange Rate, 2003 142
Table 55: Japan Industrial Gases Market Value: $ billion, 2003-2007 144
Table 56: Japan Industrial Gases Market Segmentation I: % Share, by Value, 2007 145
Table 57: Japan Industrial Gases Market Segmentation II: % Share, by Value, 2007 146
Table 58: Japan Industrial Gases Market Value Forecast: $ billion, 2007-2012 154
Table 59: Japan Size of Population (million) , 2003-2007 155
Table 60: Japan GDP (Constant 2000 Prices, $ billion), 2003-2007 155
Table 61: Japan Exchange Rate, 2003 155
Table 62: Netherlands Industrial Gases Market Value: $ million, 2003-2007 157
Table 63: Netherlands Industrial Gases Market Segmentation I: % Share, by Value, 2007 158
Table 64: Netherlands Industrial Gases Market Segmentation II: % Share, by Value, 2007 159
Table 65: Netherlands Industrial Gases Market Value Forecast: $ million, 2007-2012 167
Table 66: Spain Industrial Gases Market Value: $ million, 2003-2007 169
Table 67: Spain Industrial Gases Market Segmentation I: % Share, by Value, 2007 170
Table 68: Spain Industrial Gases Market Segmentation II: % Share, by Value, 2007 171
Table 69: Spain Industrial Gases Market Value Forecast: $ million, 2007-2012 179
Table 70: United Kingdom Industrial Gases Market Value: $ billion, 2003-2007 182
Table 71: United Kingdom Industrial Gases Market Segmentation I: % Share, by Value, 2007 183
Table 72: United Kingdom Industrial Gases Market Segmentation II: % Share, by Value, 2007 184
Table 73: United Kingdom Industrial Gases Market Value Forecast: $ billion, 2007-2012 192
Table 74: United Kingdom Size of Population (million) , 2003-2007 193
Table 75: United Kingdom GDP (Constant 2000 Prices, $ billion), 2003-2007 193
Table 76: United Kingdom Inflation, 2003-2007 193
Table 77: United Kingdom Exchange Rate, 2003 194
Table 78: United States Industrial Gases Market Value: $ billion, 2003-2007 196
Table 79: United States Industrial Gases Market Segmentation I: % Share, by Value, 2007 197
Table 80: United States Industrial Gases Market Segmentation II: % Share, by Value, 2007 198
Table 81: United States Industrial Gases Market Value Forecast: $ billion, 2007-2012 207
Table 82: United States Size of Population (million) , 2003-2007 208
Table 83: United States GDP (Constant 2000 Prices, $ billion), 2003-2007 208
Table 84: United States Inflation, 2003-2007 208
Table 85: Key Facts: Air Liquide SA 209
Table 86: Key Financials: Air Liquide SA 210
Table 87: Key Facts: Linde AG 211
Table 88: Key Financials: Linde AG 212
Table 89: Key Facts: Air Products and Chemicals, Inc. 213
Table 90: Key Financials: Air Products and Chemicals, Inc. 215
Figure 1: Growth in retail mutual funds outstrips other asset classes 12
Figure 2: Unit trusts & OEICs continue to dominate the retail mutual funds market 13
Figure 3: Mutual fund growth will decelerate between 2008 and 2012 15
Figure 4: Growth in investment trust balances will continue to outstrip unit trusts and OEICs 16
Figure 5: Retail investors continue to favor equity mutual funds, but these now account for a smaller percentage of their portfolios 19
Figure 6: 12% of unit trust and OEIC investors' funds is held within ISA wrappers 20
Figure 7: 4% of UK households invest in unit trusts 21
Figure 8: Adult males are more likely to hold unit trusts 22
Figure 9: Income is positively related to investment in unit trusts 23
Figure 10: IFAs continue to dominate sales of unit trusts and OEICs 24
Figure 11: Intermediaries' share of the ISA unit trusts and OEICs market continues to decline 25
Figure 12: Overall, IFAs are the preferred channel, but younger investors are more likely to use a variety of sources 26
Figure 13: Fund supermarkets are most used by mass affluent investors 27
Figure 14: Men are also far more likely to invest directly through an asset management firm than women 28
Figure 15: Investors of all ages value face-to-face advice; but younger clients also make use of provider and aggregator websites 29
Figure 16: Clients of all income levels prefer to speak to someone face-to-face for advice 30
Figure 17: Women are more reluctant to rely on newspapers or Internet searches 31
Figure 18: The UK market for investment trusts remains highly fragmented 33
Figure 19: Invesco Perpetual enjoys a narrow lead in the market for OIECs, PEPs and ISAs 34
[Tabellenverzeichnis ausblenden]