Active management continues to command the lion’s share of institutional investment fees, even as pricing pressure persists, according to Callan’s 2025 Investment Management Fee Study. 

Callan’s 11th annual review found that 97% of total fees paid by institutional investors in 2024 went to active managers, down just one percentage point from the prior year. The study analyzed $784 billion in assets under management and $1.9 billion in total fees across mandates run by roughly 329 investment firms for 180 institutional clients. 

“I think the pace of fee compression seems to be slowing, and may be approaching a practical lower limit for quality institutional products in some asset classes,” said Ivan Cliff, the study’s author and Callan’s director of research. 

The data—drawn from Callan’s proprietary manager database, client fee schedules, and performance records—spanned 23 asset classes across public and private markets, including separate accounts, commingled funds, and partnership structures. Mutual funds were excluded. 

Fee levels varied sharply by strategy. Hedge fund-of-funds posted the highest average fees at 113 basis points, followed by private real assets at 88 basis points. At the low end, passive U.S. large-cap equity averaged just 1.9 basis points, with passive U.S. small-cap at 3.1 basis points. 

Fee resilience was strongest in private real assets, FoFs, and global ex-U.S. equity, while core-plus fixed income, U.S. small- and mid-cap equity, and high yield and bank loan strategies showed the most pressure. 

Passively managed assets rose modestly to 39% of total assets, though active fee revenue remains highly concentrated. Just 34 firms collected half of all active management fees, underscoring the enduring scale advantage at the top of the industry.