---
title: "Assets Under Management"
url: "https://mahouse.world/glossary/assets-under-management"
type: "glossary term"
topic: "Funds"
author: "Ihor Vlasov"
reviewed: "2026-09-20"
published: "2026-09-08"
---

# Assets Under Management

Assets under management (AUM) is the total market value of the client money a firm manages or advises on: an asset manager's funds, a wealth platform's portfolios, a robo-adviser's accounts. Fees are charged as a percentage of it, so AUM is the revenue base, and the price of a wealth business is quoted as a share of it.

**Also known as:** AUM, Funds under management

## Key facts

- **Used at:** fund reporting, wealth-platform metrics, the headline figure in any asset-management acquisition
- **Binding:** no — a marketing figure unless the sale agreement defines it (managed, advised or merely held) and dates it
- **Typical fee:** 0.20–0.35% a year on a robo-adviser, 0.75–1.25% on a traditional wealth manager, 0.03–0.20% on index funds
- **Typical price:** wealth businesses have sold for 1–3% of AUM; Goldman Sachs paid $750m for United Capital's $25bn in 2019, about 3%
- **Parties:** the manager, its clients, and the custodian who actually holds the assets

## How AUM works in practice

AUM moves for two reasons, and a buyer wants them separated. Net flows are money clients add or withdraw; market movement is what the assets did in between. A platform whose AUM grew 15% in a year the index rose 20% lost clients, however good the headline. Reported AUM therefore comes with a flow statement, and diligence rebuilds it from the custodian's records rather than the manager's.

What counts is the second question. Assets managed on a discretionary mandate earn the full fee; assets on an advisory basis earn less; assets merely held in custody or "on platform" for execution earn a platform fee measured in basis points. Some firms roll all three into one number. The sale agreement names which one the price is attached to.

Revenue is AUM times the blended fee rate, and the fee rate is falling: robo-advisers priced at 0.25% forced the market down, and index funds took the rest. So the durable part of an acquisition case is not the AUM but the clients — their age, their contribution rate, how many leave when the brand changes. Wealth acquisitions are priced on retained AUM, often with part of the consideration deferred until a year after the clients have been told.

## Example

A robo-adviser has $3.0bn of AUM at 0.25%: $7.5m of revenue. Its average account is $30,000, so it has 100,000 clients, acquired at $300 each in marketing spend. Each client yields $75 a year — a four-year payback before any servicing cost. A bank offers 2% of AUM, $60m, with a quarter of the price deferred and reduced pro rata if AUM twelve months after completion is below $2.7bn. A market fall of 10% with no client leaving would trip the clause; the sellers ask for AUM to be measured at completion-date prices, and get it.

## Common mistakes

- Reporting AUM that includes assets only held on the platform, then defending the fee rate as if all of it were managed.
- Judging growth without the flow statement, so a rising market counts as client acquisition.
- Pricing a wealth business on AUM without asking who the clients are and how old they are.
- Deferred consideration tied to AUM without fixing the prices at which it is measured.
- Forgetting that the custodian, not the manager, holds the assets — the transfer needs the custodian's consent and the clients' notice period.

## Related terms

- [Robo-Adviser](https://mahouse.world/glossary/robo-adviser.md)
- [WealthTech](https://mahouse.world/glossary/wealthtech.md)
- [Net Asset Value](https://mahouse.world/glossary/net-asset-value.md)
- [Limited Partner](https://mahouse.world/glossary/limited-partner.md)
- [Take Rate](https://mahouse.world/glossary/take-rate.md)
- [Exchange-Traded Fund](https://mahouse.world/glossary/exchange-traded-fund.md)

— Ihor Vlasov, M&A FinTech Expert. Last reviewed 2026-09-20. https://mahouse.world/authors/ihor-vlasov