Third Party Marketing in Switzerland
Third Party Marketing Switzerland: The Swiss investment fund market is known for its sophistication and stability, offering international asset managers a highly attractive landscape for distributing UCITS* and AIFs. Success in this market requires a thorough understanding of local market structures, investor preferences, and the regulatory environment.
This article is intended to give a short market overview to sales decision-makers looking to expand their presence in Switzerland.
Attractiveness of the Swiss Investment Fund Market
Switzerland holds a unique position in the global investment landscape, with its reputation for financial stability and a strong tradition in wealth management. As of 2024, the total assets under management (AUM) in Switzerland for UCITS and AIFs surpassed €800 bn, reflecting a stable demand for diversified investment solutions. UCITS dominate with around €600 bn, while AIFs account for approximately €200 bn.
In the UCITS segment, equity funds play a key role, managing about €300 bn. This is mainly driven by Swiss investors’ appetite for global equity exposure. Bond funds represent €200 bn, offering Swiss investors more stability amidst volatile markets. Multi-asset funds, managing about €100 bn, are favoured by those investors seeking diversified exposure across asset classes.
Market Structure and Investor Segments
Private Banks and Wealth Managers: Switzerland is renowned for its private banking sector, which plays a crucial role in distributing UCITS and AIFs to high-net-worth individuals (HNWIs). These institutions often seek tailored investment solutions, making UCITS a popular choice due to their flexibility and transparency.
Institutional Investors: This segment includes pension funds, insurance companies, and foundations, which prefer AIFs for their ability to access illiquid assets and generate stable, long-term returns. Infrastructure and real estate AIFs are particularly appealing for Swiss institutional investors, given their focus on steady cash flows. Institutional Investors have become important players in the Swiss market.
Independent Asset Managers: These managers are key partners for international asset managers entering the Swiss market, providing access to a broad client base, including family offices and smaller institutions that seek personalised investment solutions.
Regulatory Requirements and Challenges
Navigating the regulatory landscape in Switzerland is critical for a successful market entry. Switzerland is not a member of the European Union. It maintains its own regulatory framework through FINMA (Swiss Financial Market Supervisory Authority). When thinking about entering the Swiss market, international asset managers should consider:
Fund Registration: UCITS can be distributed relatively smoothly in Switzerland through a mutual recognition agreement, but managers must comply with local Swiss regulations regarding marketing and disclosure. AIFs, however, require a more tailored approach, often involving cooperation with local representatives or authorised distributors.
Financial Services Act (FinSA): Introduced to align Swiss regulations more closely with EU standards, FinSA requires asset managers to meet strict client classification, conduct, and documentation requirements. This regulation affects how investment products are marketed and sold to different investor segments in Switzerland.
Sustainability Disclosure: Similar to the EU’s SFDR, Swiss regulations are increasingly focusing on transparency around ESG criteria. International managers looking to market their UCITS or AIFs in Switzerland must align their ESG disclosures with local expectations to remain competitive and meet investor demand for sustainable investment options.
Your Gateway to the Swiss Market
The Swiss investment fund market offers a significant opportunity for international asset managers to position their UCITS and AIFs effectively. With the support of an experienced TPM like FundFinity, managers can overcome regulatory challenges and connect with a diverse range of investors. Start your journey with FundFinity today and unlock new opportunities in Switzerland’s affluent market. Reach out today, and let’s talk about how we can support your success!
For more info: https://fundfinity.net/third-party-marketing-in-switzerland/