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Australian Funds Management Overview

In: Business and Management

Submitted By reds1xv
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Australian Funds Management Industry Overview

Australia holds one of the largest and fastest growing funds management sectors in the world.
This growth and strength is underpinned by:

• A government-mandated retirement scheme (superannuation), increasing progressively from 9 per cent to 12 per cent by 2019-2020.

• A $1.2 Trillion existing pension fund pool; the 4th largest in the world.

• A total $1.7 Trillion funds management industry (the largest in Asia-Pacific)

• A unique 410,000 + strong investment community of self managed super funds (accounting for one third of the nation’s pension fund pool)

With these figures representing a Compound Annual Growth rate (CAGR) of 11.9% since 1994, Australia’s total Funds Under Management (FUM) is:

• 20% larger than the market capitalisation of the entire domestic equity market ($1.403 trillion)

• A 135% of the Australian nominal GDP

With forecasts stipulating that by 2015, Australia’s total FUM will reach $1.979 trillion, the continued changing sophistication and asset allocations of investors coupled with the robust underlying sector fundamentals has created opportunities for the launch of new funds in niche the areas of infrastructure, direct property and global macro trading.

Current Opportunities

In light of the consequences of ageing populations in virtually all developed counties and unstainable government debt levels, pension systems globally are coming under greater stress and scrutiny than ever before.

The provision of financial security in retirement is the critical issue for both individuals and societies grappling with the social and economic effects of the major demographic shift.

Domestically Australia, despite its total Funds Under Management (FUM), is no different.

When compulsory superannuation was...

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