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Tiburon: Investable assets to hit $80T by 2017

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Investable assets market firms will be chasing an $80 trillion market by 2017, according to a new report.

Tiburon Strategic Advisors, Tiburon, Calif., published this in a summary of results from its survey, “State of the Financial Products and Services Businesses: Deleveraging, Increasing Investable Asset Options, and Growing Insurance Demand.” The March 2013 report is part of Tiburon’s Financial Institutions Research Series.

The report discloses that investable assets market firms have gathered $63.1 trillion assets under management, up 30% since 2004 but down from its peak of $69.4 trillion in 2007. Mutual funds assets under management total $13.0 trillion, including $11.6 trillion in open-end mutual funds. Open-end mutual funds have gathered $11.6 trillion assets under management, up 300% since 1995 but down from its peak of $12.0 trillion in 2007

Closed-end mutual funds have gathered $239 billion assets under management, up over 50% since 1995 but off its peak of $312 billion in 2007

Unit investment trusts, the report adds, have gathered $60 billion assets under management, down 20% since 1995. The ETFs and indexing product market has gathered $5.1 trillion assets under management, including $3.0 trillion in indexed separate accounts

Exchange traded funds have net flows of $185 billion, up 500% since 2001, and above their prior peak of $177 billion in 2008. The report also pegs global hedge funds at more than $3.0 trillion, the total including U.S. hedge funds, managed futures funds, hedge fund mutual funds, and non-U.S. hedge funds.

Among the report’s additional findings:

Nearly one-quarter of all financial advisors plan to offer wealth management services to their clients in the next twelve months.

Consumer household personal assets declined $1.2 trillion or 5% since 2006 to $25.6 trillion.

The number of insured households will increase to 305 million by 2012.

The number of insurance industry policies will increase to 219 billion by 2012.

Insurance in force is on the rise, increased to $78 billion by 2012.

Life insurance agents are who hold NASD securities licenses are expected to reach 55% by 2012.

529 plans assets under management will increase from $119 billion to $350 billion assets under management by 2014.

529 plan assets will shift further to age-based portfolios, with such share increasing from 69% to 75% in 2014.

Almost three-quarters of baby boomers have an estate plan.

Over one-third of financial advisor intermediated consumer assets are now in fee-accounts.

Financial advisors intend to increase their usage of index funds by one-third. And they intend to decrease their usage of exchange-traded funds, alternative investments and variable annuities by over 30% each.

Long-term mutual funds continue to dominate the investable assets market, with over 50% market share.

Financial advisors have decreased their usage in mutual funds to under one-half and have subsequently increased their usage in exchange traded funds and individual securities and fixed income.