How are asset managers viewing the market and opportunities for 2024 after a year of interest rate increases, inflationary pressures, global conflict, a growing focus on generative artificial intelligence (GenAI), and the coming US elections?
To find out, KPMG LLP (KPMG) conducted a survey between November and December of 2023 (with the survey closed before the December 13 Federal Open Market Committee meeting), to obtain insights on both economic and strategic initiatives heading into 2024. Responses were collected from more than 170 asset management professionals in the US, primarily in C-suite and board roles, representing private fund managers, traditional fund managers, publicly traded entities, and institutional investors, investing across various asset classes including real estate, hedge funds, private debt, private equity, and public securities, with a majority holding $2.5 billion or more in assets under management (AUM).
While the Federal Reserve’s decision to cut interest rates will depend on inflation continuing to decelerate in 2024, most respondents to our survey said they expect interest rate cuts beginning in 2024.
From an investment perspective, while availability of capital was the largest concern for respondents, private debt and private equity were perceived as offering the best returns in the next three years. Respondents’ additional concerns were focused on talent risk and geopolitical uncertainty.
From a strategy standpoint, the survey found that asset managers are looking to invest in emerging technologies and are exploring the use of GenAI, though they are taking a measured approach for now. Employees at most firms are back in the office or embracing a hybrid model. From a diversity, equity and inclusion standpoint, many asset managers believe there is still room for growth in their company.
Review our findings in the LinkedIn Article, LinkedIn Live playback, and Infographic at the links below.
