Shifting Interests
2024 SMA Asset Flows and Investor Reporting Trends
SMA Asset Flows and Reporting interest
As we analyze the investment landscape of 2024, key trends emerge from the shifting patterns of asset flows and investor interest. Fixed income strategies dominated, with municipal bonds experiencing a surge in popularity, while equity strategies faced notable declines in engagement. Through PSN’s extensive reporting data, we gain unique insights into how institutional investors and financial advisors are navigating market uncertainties. As we move into 2025, these trends raise important questions: Will the momentum in fixed income persist? Could early signs of renewed interest in equities signal a broader shift? This report explores these dynamics, providing a comprehensive look at the evolving SMA landscape.
SMA Total Asset Flows
The total asset flows for the year revealed consistent leadership among the top five universes in both Q3 and Q4. PSN US Fixed Income maintained its dominant position, albeit with a slight moderation in momentum. The universe closed the year with $123.25 billion in asset flows, a decrease from the $168.98 billion observed year-to-date in Q3. However, the standout performer was the PSN Municipal Fixed Income universe, which demonstrated significant growth and had the highest year-to-date percentage increase at 7.55%, underscoring the growing appeal of municipal bonds among investors.
Investor Interest:
While asset flows are one way to gauge interest in a universe, another interesting method is to monitor the research activity taking place through reporting activities. Looking at the aggregate of all PSN Enterprise reports for strategies contained within each universe we saw that reporting activity for fixed income universes grew significantly from 2023 to 2024 mirroring the asset flows we saw during the year. We also saw decreases in reporting activity for equity strategies throughout the year.
One notable difference in the top 5 universes is the inclusion of Long-Term Fixed Income, where municipal fixed income did not make the list in terms of reporting interest. The most significant decreases were in equity strategies, most significantly the US Equity strategies that saw a decrease in reports generated by over 40,000. While these statistics show a headwind for the US Equities market in terms of the SMA investment it is interesting to note that there are plenty of strategies in all universes who have seen considerable growth over the year. Within the out of favor US Equities Universe the top 5 growing SMA strategies all had asset flows for the year of more than $6 billion dollars.
Q1 2025 Reporting interest
While we won’t be able to review Q1 asset flows for some time, the Q1 reporting information shows some increasing interest in the equities sector. The universes showing the most growth from Q1 2024 are all equity universes, with PSN Large Cap topping the list and 2 International universes right behind it. This could indicate that investors are looking for opportunities for diversification even with the uncertain tariff environment ahead. We will have to wait for the asset data to become available to determine if the reporting interest is an indication of changing investment activity or just an effort to monitor current market conditions.
This table shows the top 5 strategies from each of the PSN universes who received the most reporting interest and least reporting interest for the year of 2024. (Click Image to View).
