Luxembourg continues to dominate the global cross-border fund registration landscape, holding a 54.6 percent market share despite a slight 0.4 percent drop in 2023, according to PwC Luxembourg’s latest Global Fund Distribution Poster. The 24th edition of this annual posted provides an in-depth analysis of the fund distribution trends across over 40 countries.
In 2023, the number of global true cross-border funds increased to 14,725 from 14,607 in 2022. Furthermore, global cross-border fund registrations saw a growth of 1.6 percent, reaching 140,635, up from 138,467 the previous year.
Luxembourg, alongside Ireland, continues to command a significant portion of the market, managing 7.5 trillion euro of the 13.1 trillion euro in European Ucits assets. With Luxembourg’s share at 54.6 percent and Ireland’s at 36.4 perceny, they collectively dominate the market. Equity funds emerged as the predominant asset class, holding 50 percent of global cross-border assets, followed by bond funds at 27 percent.
More interest in alternatives
Robert James Glover, advisory partner for global fund distribution at PwC Luxembourg, noted a balanced increase in both ETFs and mutual funds. Glover also pointed to the potential shift in the non-Ucits sector, indicating a broadening interest in alternative fund registrations.
“The appetite for global diversification is undeniable,” he said in a statement. “We’re seeing a surge in new fund registrations, particularly in Spain, as investors seek exposure to international markets. Equity funds remain the clear favourite, holding the majority of cross-border assets. Interestingly, Ucits funds continue their reign supreme, with Luxembourg leading the pack.”
Ucits account for bulk
Ucits funds represent the bulk (91.6%) of the global cross-border fund market, with Luxembourg leading at 54.5% and Ireland at 32.0%. In the non-Ucits sector, both Luxembourg and Ireland experienced growth in market share in 2023, rising by 0.6% and 1.0%, respectively.
Top asset managers in the true cross-border fund sector include Franklin Templeton and BlackRock, with Fidelity Investments, UBS, and JP Morgan also making significant strides.
The report highlights several key regions for new registrations:
- In Europe, Spain led with 262 new registrations, followed by Italy, Austria, and Denmark.
- Singapore was the top market in the APAC region, with Hong Kong and Macau following.
- The UAE dominated the Middle East with 401 registrations.
- In Africa, South Africa maintained the highest number of registrations despite a slight decline.
- Bermuda saw notable growth in the Americas, while Chile remained the leader in total registrations.
On sustainable finance, Luxembourg leads in SFDR Article 8 and 9 funds, holding a majority share in the market, followed by Ireland and France, according to PwC.
Further reading on Investment Officer Luxembourg:
- ETFs growing twice as fast as Ucits funds, PwC study shows
- PwC: Luxembourg ManCos redesigning operating models