Should you chance to overhear the CEO of a fund management company bemoaning his or her lot in life, feel free to dispatch a freshly drawn, icily cold bucket of water over that individual. McKinsey & Co’s 2005 asset management survey reveals that the average cost-income ratio in the industry is now 58%, in other words asset managers are operating with margins above 40% on average.
It’s no wonder then that investment banks and broker dealers, where even the very best managed businesses, such as UBS, have margins at the low 30% level, continue to find asset management franchises beguiling.
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