Just as the oncoming adjustment from accumulation of assets to decumulation is stumping asset management firms and advisers in the U.S., the U.K. is facing the same challenges.
That means that across the pond, just like here, firms will be looking for creative new products that are outcome-oriented, rather than market-oriented.
“But very few financial products address these goals directly,” according to the U.K.’s Investment Adviser. “This is a great market gap that is waiting to be filled.”
Because products with guarantees are expensive for asset management firms to create because they require a lot of capital, some U.K. companies are beginning to offer hybrid products that may not offer guarantees but at least attempt to achieve certain goals.
Another approach is absolute return, whereby the fund attempts to achieve a return higher than cash but without all of the risk of equities.
The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.