Experts have attributed the surge to the improved performance in South Africa’s equities market.
“Performance in the equity market has been outstanding as there have been a growing number of asset managers and money managers and people looking to manage that money,” David O’Leary, fund researcher at Morningstar South Africa told CNBC Africa.
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“The market has developed as some firms are able to provide accounting and administrative support,” he added.
O’Leary said the improvement in the administrative support makes the hurdle of getting involved with asset management lower.
The industry expert said there was no clear-cut answer on whether it was advantageous to have small or big fund managers.
O’Leary said there were dangers with firms which become very large and the same can be said about smaller firms.
“Some big firms end up losing focus due to the size and along become bureaucratic machines.”
(WATCH VIDEO: Growth of black fund managers in South Africa)
O’Leary prospective investors needed to look at the level of investments by people managing the funds one intended to invest in but said this alone was not a guarantee that a person was investing in the right place.
“What you want to see is that the firm and the fund managers have a vested interest in the performance of the fund and experience investing in that firm,” he said.
He also added that unfortunately a number of firms were not comfortable giving private information of their company’s operations.
O’Leary said performance and track record were important factors in choosing fund managers.