Over 50 billion dollars outflows from world’s largest investment companies in 2023

The world's six largest investment firms recorded a cumulative outflow of 52.55 billion dollars from their market capitalization in 2023

Despite being considered some of the most stable players in the market, investment companies have been hit hard by prevailing economic conditions. The situation has led to selected investment giants recording enormous capital outflows as the future remains uncertain.

In particular, data acquired by Finbold indicates that as of March 16, the world’s six largest investment firms recorded a cumulative outflow of 52.55 billion dollars from their market capitalization in 2023. Four affected companies are based in the United States and account for almost 80% of the lost capitalization.

U.S.-based investment giant Berkshire Hathaway accounts for the highest loss of 29.12 billion dollars or 4.27%, with the firm’s current market cap standing at 652.66 billion dollars. BlackRock’s market cap of 94.91 billion dollars represents year-to-date losses of 11.52 billion dollars or 10.82%.

International Holding Company has the third-highest losses at 8.97 billion dollars, followed by Prosus with an outflow of 1.64 billion dollars. Crown Castle ranks fifth with a market cap of 57.51 billion dollars after recording an outflow of 1.23 billion dollars. U.S. banking giant Morgan Stanley has the least losses of 0.07 billion dollars.

Elsewhere, some firms also recorded capital inflow on a YTD basis, led by Blackstone Group, which has a market cap of 62.57 billion dollars after attracting 9 billion dollars. Prologis has an inflow of 6.76 billion dollars, followed by Equinix at 3.86 billion dollars. Investor AB has a market cap of 58.13 billion dollars with a 2023 inflow of 1.46 billion dollars.

Economic uncertainty hits investment companies’ capitalization

The research explained how market conditions had impacted the capitalization of investment firms. According to the research report: “The plunge in market cap is a direct impact of investors’ rising level of uncertainty due to persistently high global inflation, change in monetary policies, and interest rate hikes by various central banks. The elements have culminated in concerns about a worldwide recession as investors partly dump stocks in search of products to cushion against inflation.”

Looking ahead, the prevailing level of uncertainty could push investors targeting investment firms to stay on the sidelines until market conditions improve.

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