The UK investment management industry recorded 10% growth in assets under management to reach a new high of £10trn in 2024 (2023: £91trn).

The industry was boosted by an increasing number of assets managed from the UK of behalf of overseas investors, according to the Investment Association.

Assets managed on behalf of overseas clients passed 50% for the first time (51%), making up £5.1trn of AUM.

Overseas client assets have more than doubled over the past decade, growing at a faster rate than UK client assets, which increased roughly 40% over the same period.

Of the total assets, 28% were managed on behalf of retail investors, passing a higher percentage of the total assets under management than pension funds (27%) for the first time.

Pension assets have fallen from a peak of 45% of total AUM in 2018, driven by factors including increasing number of defined benefit schemes winding down and the impact of the 2022 gilt crisis.

Chris Cummings, CEO of the Investment Association, said: “The UK investment management industry has reached record highs over the past year, a testament to firms’ resilience amidst geopolitical and economic uncertainty. The industry has not only adapted to the challenges of 2022 and 2023, but has flourished, with assets under management now reaching £10trn.

“Industry growth has been supported by the UK’s status as a global centre of excellence for portfolio management as we retain and attract an increasing number of overseas clients. Significant improvements to the regulatory environment, enabling firms to introduce appropriate levels of risk and foster innovation, are helping UK firms to continue to thrive and take important steps towards creating a culture of inclusive investment in the UK.”

Active management still represented roughly two thirds of assets, but index trackers have grown by 24% over the past decade, reflecting the demand for lower cost investment options.

Of the £4.9trn of assets managed from the UK that sit in investment funds, almost three quarters (69%) were in funds domiciled overseas. Most of 2024’s investment fund growth came via funds domiciled in Ireland, which now make up over half of overseas fund assets managed from the UK.