Benjamin Reed‑Hurwitz, Head of Research and Development for North America and EMEA at ISS Market Intelligence, recently sat down with Asset TV to discuss why 2025 became a year of opportunity for U.K. asset managers, even amid declining net sales, and how diversification, outsourcing, and changing portfolio construction are reshaping who wins.
In the conversation, Benjamin outlines five powerful insights that explain how some firms outperformed in a difficult market environment and what asset managers must do to stay competitive. Watch the video below and read on for the key insights.
2025 Was a Tough Year on Net, but a Record Year for Opportunity
While net sales across the U.K. fund industry declined in 2025, Benjamin stresses that this headline misses a critical point: gross sales reached record levels. That distinction matters because gross sales represent the opportunity individual managers can win, even in a negative environment.
More than half of fund managers contributing to the Pridham Report actually saw improved sales year over year, demonstrating that market headwinds help redistribute opportunity. Tough markets amplify the importance of positioning, relevance, and alignment with buyer behavior.
Diversification was the Defining Theme of the Year
Benjamin calls 2025 “the year of diversification,” driven by uncertainty across rates, inflation, economic growth, taxation, and geopolitics. Investors were searching for ways to spread risk across geographies, asset classes, and strategies. Many managers succeeded by aligning with a specific diversification narrative.
Rather than chasing every trend, winning firms anchored their success to one clear diversification story that resonated with investors’ concerns.
Asset managers should refine how their strategies fit into a broader diversification conversation, clearly articulating the specific role their products play in portfolios.
Outsourcing is Reshaping Who Controls Fund Flows
Benjamin says that while diversification defined the year, outsourcing will define the decade. Advisors are increasingly handing off portfolio construction to centralised investment propositions, model portfolios, and multi‑asset solutions, dramatically shifting control away from traditional fund selectors.
These new portfolio constructors now act as “dams in the river of flows,” determining where capital ultimately lands. As a result, asset managers must understand the models, platforms, and multi‑asset providers that sit between advisors and funds.
Winning flows increasingly means building relationships with model portfolio providers, MPS players, and centralised allocators.
The New Portfolio Blend is Creating New Winners
As portfolio control shifts, portfolios themselves are evolving into lower‑cost blends of active and passive strategies. This transition initially accelerated passive adoption, but it is now opening new doors for:
- Systematic and enhanced index strategies
- Quantitative approaches priced between active and passive
- High‑alpha and outcome‑oriented strategies in satellite allocations
Benjamin notes that a cheaper core has created more room for differentiated, higher‑alpha investments, including a resurgence in absolute return strategies.
Asset managers should position strategies clearly as either core‑efficient building blocks or high‑conviction diversifiers, and price and message accordingly.
The Path to Winning is Paved with Authenticity, Segmentation and Data
In a more consolidated, institutionalised retail environment, Benjamin emphasises that asset managers are moving from being ‘makers’ to ‘takers.’ Success now depends on knowing who you are, what you deliver, and who you are meant to serve.
Firms that succeed are having the right conversations with the right buyers at the right time. With support from data providers such as ISS Market Intelligence, asset managers are using data and segmentation to understand buyer preferences, identify who truly influences portfolio construction, and tailor messaging accordingly, rather than relying on one‑size‑fits‑all sales strategies.
Investing in data‑driven segmentation enables firms to better understand buyer behavior, align product positioning with how portfolios are actually being built, and engage key decision‑makers with greater relevance and precision.
Opportunity Has Not Disappeared, it’s Shifted
The core takeaway from Benjamin Reed‑Hurwitz’s conversation with Asset TV is clear: opportunity in asset management has not vanished, it has simply moved downstream. Firms that understand where control now sits, how portfolios are constructed, and what buyers truly value are finding meaningful ways to grow, even in negative net‑flow environments.
In a market defined by diversification, outsourcing, and consolidation, success belongs to asset managers who adapt with clarity, flexibility, and insight.
To understand how fund flows are evolving, who controls portfolio construction, and how to engage the right buyers with the right message across the U.K. financial landscape, learn more about the Pridham Report and the Portfolio Construction Report from ISS Market Intelligence.
