Institutionally priced funds amassed $612 billion of net new fund flows in 2017, an increase of 15% over the previous year, Broadridge Financial Solutions reported Thursday.
Broadridge’s data showed that half of actively managed institutional funds assets came from retail channels: registered investment advisors, broker-dealers and online.
The other half was from institutional channels: banks, private banks and trusts.
Private banks were the largest channel for institutional funds, with $880 billion.
What Your Peers Are Reading
According to the data, the amount of retail assets invested in institutional funds has steadily increased over the past five years, from less than 37% at the end of 2012.
Broadridge said that the infusion of retail assets into institutional funds has been especially pronounced for RIAs, which held $852 billion in institutional funds at the end of last year. RIAs are also the largest channel for ETFs, with more than $923 billion.
The combination of institutionally priced actively managed funds, ETFs and index funds has made the RIA channel the prime target for asset managers, according to Broadridge. Overall fund and ETF assets amounted to $2.8 trillion at the end of 2017.
“Active managers pushed back on index funds and ETFs in 2017 by cutting fees for actively managed funds, and introducing institutional shares for existing funds,” Frank Polefrone, senior vice president of Broadridge’s data and analytics business, said in a statement.