RIAs closed out 2025 with more muted performance in the fourth quarter, as publicly traded investment managers generally lagged the broader equity market following strong gains earlier in the year. Traditional asset and wealth managers saw modest pressure on share prices and valuations, reflecting moderating earnings expectations and some evidence of fee compression, even as profitability trends remained resilient—particularly among smaller managers. Alternative asset managers faced a more challenging quarter, with declining prices and valuation compression driven by investor preference for traditional strategies in a higher-for-longer rate environment. Despite near-term headwinds, scale, recurring revenue models, and long-term growth fundamentals continued to underpin investor interest across the sector. We explore these trends further in our Q4 2025 Market Update.

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