(Bloomberg) -- The global fund-management industry may see profitability cut by as much as half if it must pay for equity research that cost investment banks $5 billion last year, according to a report.

The operating margins of asset managers’ active equity firms would fall to 12.5 percent from 23.5 percent if regulators make the industry pay for research now covered by investment banks’ trading commissions, a study released by Frost Consulting & Advisory and Quark Software Inc. said today.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.