The 2025 CIO Sentiment Survey, a global collaboration between Top1000funds.com and Casey Quirk, part of Deloitte Consulting, finds asset owners more confident of reaching their return targets, but less favourable towards equities, based on valuations. For the first time in three years asset owners are looking to expand their external manager roster.
Most of asset owners are confident about meeting their return targets in 2025, but are wary of more pronounced equity risks and the return of inflation risks amid uncertain trade and immigration policies
Close to half of respondents plan to make allocation changes in 2025, on par with last year. They are withdrawing from active and passive equities and piling into alternatives
External stakeholder pressure has become the new top challenge in asset owners’ day-to-day operations, speaking to the politicisation of pension sectors around the world and increasing demand for funding
The percentage of asset owners confident in meeting their return target has reached a three-yearhigh buoyed by strong market returns, according to the 2025 CIO Sentiment Survey – a global collaboration between Top1000funds.com and Casey Quirk, part of Deloitte Consulting. However, the increasing complexity of the investment landscape may result in slower allocations and mandate awards.
The 2025 edition marks the 10th anniversary of the CIO Sentiment Survey, which has become a key annual indicator of asset allocation and operational designs trends in asset owner organisations.
This year’s survey respondents were primarily CIOs of pension and superannuation funds, but also included those of sovereign wealth funds, endowments, foundations and insurers. Over half are large funds, defined as having over $25 billion in assets under management. Geographically, over half were North American asset owners, with the rest spread across Asia Pacific, Europe, the Middle East and Africa, and Latin America.
The percentage of CIOs who are making allocation changes remains elevated but is on par with last year, at 47 per cent.
The year is shaping up to be an “inflection point” not only for plans and institutions, but also for third-party asset managers as markets start to peak and trade policy impacts start to manifest themselves in economic systems, said senior consultant at Casey Quirk Anthony Skriba.
“I hesitate to say that we're in for a correction or a downturn – it does seem like the past three years have been too good to be true, in some sense. So even a plateauing would be problematic for a lot of investors,” he said.
Public equities, and in particular US equities, have been one of the biggest return drivers of multi-asset portfolios in recent memory but asset owners are increasingly wary about their high valuations. As a result, more investors are planning to decrease both active and passive equity allocations than those planning to increase them.
Meanwhile, inflation concerns picked back up amidst uncertain trade and immigration policies and more CIOs are planning to rotate into fixed income and real assets to combat the headwinds. The risks asset owners are least worried about are climate risks and credit risks. Within fixed income, active core/core+ and active unconstrained strategies have the highest planned net allocation increase.
Demand towards alternatives grew slightly from 2024 but did not match the height in 2022. The asset classes receiving most interests were infrastructure/other real assets (non-inclusive of real estate), private credit and private equity, despite ongoing exit challenges especially in the latter. “There’s a very strong possibility that alternatives globally are somewhat over invested, and it’s not clear that there are enough exits within at least PE to support a lot of the new deal flow,” Skriba said.
"Fixed income is the next best place. But in some sense, there’s a lot of capital chasing limited returns, or what might become limited returns over the next few years.”
Confidence in Meeting Return Target
% of respondents choosing "Yes", 2024 vs. 2025
Taking More Risk to Achieve Return Target
% of respondents choosing "Yes", 2022 – 2025
Pensions
10%
Others
29%
This year’s survey revealed that asset owners are grappling with a new top challenge in the investment team’s day-to-day operations – external stakeholder pressure. Half of respondents cited it as one of their top three team challenges and the percentage is at a three-year high. It speaks to worries around the world that the pension sector is increasingly politicised. For example, in UK and Australia, funds are encouraged to invest domestically or to support projects related to national priorities, such as energy transition infrastructure. But some cases could see politicians exert more direct influence over an institution as exemplified by Canada’s Alberta Investment Management Corporation.
Another aspect of external stakeholder concern is that asset owners are expecting to see a lot more demand for funding materialise in the coming years, Skriba said. “I think that’s why we had some consensual information about changing demographics and pressure on pension type of funds globally,” he said.
Other top concerns are lack of necessary systems or tools, understaffed internal teams, and personal time constraints.
Where asset owners are planning to do the most net hiring in the next 18 months was investment staff, however the percentage was lower than last year. In fact, the hiring pace has slowed down across all internal functions, from board and executives to operations.
Small plans have less demands for risk personnel compared to big and medium plans, and Skriba highlighted that the complexity of investment operations and spread of geographical footprint is relevant to this decision.
Following two years of manager consolidation, there are signs that asset owners are seeking to expand their roster again as the percentage of respondents who are looking to increase the number of managers they work with is at a three-year high.
“They are decreasing [the number of managers] less or trying to find more strategic partnerships,” he said. “Some of those would be to get access to different types of investments...then just the difficulty of housing certain types of talents [plays into it] too.”
In alternatives, infrastructure and other real assets have the highest planned net manager allocation increase, followed by private credit. Meanwhile, venture capital is where specialist managers are most in demand, while asset owners are more likely to co-invest alongside managers in private equity.
The results of the CIO Sentiment Survey broken down into investment impact and themes
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Asset owners’ interest in alternatives reached a height in 2021 when a net of 45 per cent respondents said they are planning to increase allocations in the area. The demand has been trending downwards in the three years since then, but now there are signs that enthusiasm towards the asset class is picking back up.
A net of 26 per cent respondents said they will allocate more to alternatives in the 2025 survey. When breaking down the areas of allocation further, funds are most interested in infrastructure and other real assets (excluding real estate) and private equity, as well as private credit and venture capital to a lesser extent. There is also a planned net allocation increase in real estate as the beat-up sector recovers from elevated interest rates and in some pockets, such as office, offers room for opportunistic investments.
Casey Quirk’s Skriba said. Some respondents voiced concerns that the alternatives markets may be approaching saturation.
CIO's Planned Net Changes* in Alternatives
By asset class, % of respondents, 2025
Category
% Planning Net Increase/Decrease
Infra/Real Assets
Private Equity/VC
Private Credit
Venture Capital
Hedge Funds
Real Estate
47%
42%
36%
19%
8%
6%
While dry powder is decreasing from the 2023 record high, suggesting impending deal activity globally, Skriba said the exit concerns are not out of the picture especially for private equity.
“I think there is a perception that there’s not a lot of places to go [for asset owners looking to allocate capital],” he said. Some respondents voiced concerns that the alternatives markets maybe approaching saturation.
The survey found that the priority for over half (56 per cent) of asset owners regarding their alternatives allocations is to create relationships with new managers, followed by negotiating lower fees (39 per cent), reducing re-ups due to lack of capital returns (33 per cent), and managing exposures through secondaries (33 per cent).
Infrastructure and other real assets have the highest planned net manager allocation increase, followed by private credit. Meanwhile, venture capital is where specialist managers are most in demand, while asset owners are more likely to co-invest alongside managers in private equity.
How do you approach manager allocations within the following private markets asset classes?
% of respondents
