World’s largest asset owners reach new record

NEW YORK, Nov. 25, 2024 (GLOBE NEWSWIRE) — Assets of the top 100 asset owners globally returned to growth in 2023 after a fall of 8.7% in 2022, according to new research by leading global advisory, broking and solutions company WTW’s (NASDAQ: WTW) Thinking Ahead Institute.

As a result of a marked 12.3% year-on-year increase from 2022, recovering the losses from the previous year, the world’s largest 100 asset owners (the AO100) now hold a record US$26.3 trillion as of the end of 2023.

The full Asset Owner 100 study also reveals the evolving split between different types of asset owners. Sovereign wealth funds (SWFs) remain a dominant force among other types of asset owners, now managing 38.9% of the assets among the AO100, or nearly two-fifths. In comparison, pension funds, while still forming the largest assets under management by fund type (51.2%), saw the smallest growth rate, with assets held rising by 8.9% from the previous year.

Pension funds have represented a declining proportion of the AO100 in North America and in Europe, Middle East and Africa (EMEA) since 2017, falling in favor of outsourced chief investment officers and SWFs’ accelerated growth. Across EMEA, the pattern is more pronounced, as SWFs now form 70% of total assets in the region. In comparison, SWFs manage 43% of assets in Asia Pacific and 2% in North America.

The Government Pension Investment Fund of Japan remains the largest single asset owner in the world, with assets under management (AuM) of US$1.59 trillion alone. The top three globally also include the two largest sovereign wealth funds: Norway’s Norges Bank Investment Management in second place with AuM of US$1.55 trillion and China Investment Corporation now in third place with US$1.24 trillion.

EMEA is the largest region in the AO100 study, accounting for 34.3% of total AuM, closely followed by Asia Pacific with 33.0% of total AuM. North America represents 32.7% of total AuM.

“Asset owners globally are navigating a series of waves and occasional storms — from market volatility and geopolitics to technology and structural changes in societies and economies,” said Jessica Gao, director of the Thinking Ahead Institute.

“Macro trends matter. Over the past 12 months, the global investment macro environment has been marked by volatility and mixed performance across asset classes. Interest rates reached significant highs in 2023. The first half of 2024 brought some stabilization in global markets, as base rates remained relatively flat. After a sustained period of elevated rates aimed at controlling inflation, central banks began to implement gradual rate cuts in the latter half of 2024, marking the first reductions in years; however, market volatility remains high with uncertainty due to geopolitical events and several major elections.

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