Top 10 Third-Party Asset Managers of 2023: Broadridge

During last year’s financial market turmoil, firms using third-party asset managers hunkered down and stuck with major, time-tested brands, an annual research study by Broadridge Financial Solutions finds.

Broadridge’s latest Fund Brand 50 report zooms in on these asset management brands and uncovers what large advisory firms and other gatekeepers consider to be the most valuable attributes of the investment products they offer clients.

The third-party asset managers cited in the Broadridge survey each received a total brand score. Its rankings are based on input from over 1,200 large fund distributors in the U.S., Europe and Asia-Pacific region. The U.S. rankings are tied to responses from about 200 participants.

These advisory firms and gatekeepers also named their top three fund suppliers across 10 brand attributes:

Appealing investment strategy
Solidity
Market knowledge
Client-oriented thinking
Expertise
Thinking and acting globally
Keeping well informed
Investment management team stability
Innovation and adaptation to market change
Social responsibility and sustainability

“U.S. fund buyers sought the security of tried-and-tested products with regular income components and low risk, while displaying a preference for established brands with a proven track record of high performance,” said Jeff Tjornehoj, Broadridge senior director of distribution insights.

“Asset managers jostled to differentiate themselves by developing their product offering and increasing transparency. But the overall effect was something of a closed shop, as fund selectors doubled down and largely kept their business where it was,” he said in a press release.

He told ThinkAdvisor in an interview on Tuesday, “In times of uncertainty, people have a difficult time trying new and unfamiliar brands, and I think that was revealed in the numbers we got back.”

The top-ranked asset manager wasn’t necessarily ranked number one in all categories, Tjornehoj noted.

Industry giants shored up their high rankings as those selecting third-party funds highly valued approachable, knowledgeable specialists whose high service levels lessened clients’ research burden, Broadridge noted.

U.S. fund buyers favored wide product choice while relying on a smaller core of safe investments, which led to an abundance of products competing for limited “shelf space,” the firm said.

Nine of the top 10 received higher brand scores for 2022, reflecting client firms’ decreased willingness to try out new products, according to Tjornehoj, who noted this was the third year for the study in the U.S.

Broadridge also found product development and innovation important to fund selectors — large advisors and gatekeepers — with model portfolios and ETFs proving to be differentiators. Transparency on fees and portfolios offered a competitive advantage, and direct indexing technology has become a key function, the firm found.

See the gallery for the top 10 U.S. third-party asset managers based on Broadridge’s study and the attributes for which each was rated highest.

(Broadridge provided ThinkAdvisor with one top attribute per asset manager, though — in some cases — the asset manager has two or more top attributes.)

(Image: Shutterstock)