BofA downgrades UK asset managers over recession risks and weak flows

Schroders and Ninety One

Bank of America has downgraded its outlook for UK asset managers, such as Schroders or Ninety One, due to their higher sensitivity to recessionary risks, near-term flow headwinds and premium valuations.

According to a research note published by Hubert Lam, Philip Middleton and Alexandre Tissieres on Monday (9 January), the bank has changed its outlook for Schroders and Ninety One from Neutral to Underperform, joining Jupiter, Ashmore and abrdn.  The researchers pointed to Schroders as the asset manager with the most earnings sensitivity to an economic downturn, which is set to affect the UK the most, coupled with weak flow momentum in mutual funds and LDI-driven redemptions at UK pensions.  Meanwhile, analysts expect continued institutional risk aversion and higher retail client rede...