Market snapshot: The most exciting asset class innovations in 2025

Asset and wealth management has faced plenty of challenges over the years – but to overcome the obstacles, fund managers need to be able to seize every new opportunity. To understand the recent shifts in the global market, we catch up with Johanna Juujärvi, Head of Manager Selection at Finnish Aktia, and explore how the active management landscape is developing and which asset classes are coming into favour.

What investment trends and product preferences are shaping fund selection at Finnish Aktia?

There is a always demand for fund managers who can deliver consistent alpha across diverse asset classes, whether that involves broad core investments or more niche, specialised strategies. Sustainability and long-term performance remain key priorities.

Over the past year, active managers faced challenges as the performance of the magnificent seven tech giants dominated index returns. This has shifted some interest towards passive index funds, which outperformed actively managed funds. However, we’re already seeing a shift in Q1 2025, with investors questioning the long-term effectiveness of passive strategies and looking to diversify away from over-concentration in major indices.

In fixed income, there has been an increased appetite for longer-duration investments, particularly in investment-grade corporate bonds. High-yield funds have also attracted inflows due to their appealing yield levels, and the ongoing uncertainty in global macroeconomic conditions has heightened interest in fixed income as a more stable asset class.

What challenges and disruptions are you facing now and in the future?

The most pressing challenges revolve around performance and shifting market dynamics. The dominance of the magnificent seven tech stocks has made it more difficult for active managers to consistently outperform their benchmarks. Additionally, there is mounting pressure to reduce fees, as investors are increasingly focused on cost efficiency.

Another key challenge is the growing demand for liquidity, even in asset classes that are traditionally considered illiquid. This trend is prompting the industry to innovate and create more flexible investment structures that strike a balance between liquidity and performance, ensuring that both investor needs and risk considerations are met.

What product innovations are catching your eye? Is there an asset class you’re particularly interested in?

A significant area of innovation we’re watching is in alternative investments, specifically semi-liquid alternatives. These strategies are becoming increasingly popular, and we are seeing a surge in new fund structures designed to meet this demand. However, these products require thorough analysis due to their complexity, with variations in risk profiles, return potential, and liquidity terms.

It’s important to note that we haven’t lost sight of our core focus: identifying stable, high-performing managers in liquid markets. This remains a cornerstone of our investment approach.

What are you looking forward to the most at IMpower FundForum?

I'm excited about the opportunity to engage with industry leaders and connect with peers. The chance to exchange ideas, learn about the latest trends, and discuss innovative approaches to investment is invaluable. It’s also an excellent environment to explore new perspectives that could shape the future of asset management and drive success in an ever-evolving market landscape.

Join Johanna Juujärvi and 1,500+ global asset and wealth management leaders at IMpower FundForum!