Artificial intelligence (AI) is reshaping asset management client relationships, according to a global survey from Clearwater Analytics.

Asset managers, hedge funds and private markets specialists collectively see AI becoming a client relations issue as well as a technology matter.

Nine out of 10 asset managers told researchers they believe investors expect firms to have ‘meaningful AI budgets’ within the next three years

Two in five (43%) asset managers said that between a quarter and half of their client base ask about how AI is employed, while two-fifths said between 10% and 24% of clients investigate how they use the technology.

More than a third of participants (34%) expect this trend to ‘increase dramatically’ over the next three years and 57% said it will increase slightly. Just under one in 10 (9%) said it will stay the same.

Client sentiment is high regarding how AI is deployed by asset managers, with 85% of respondents saying their investors’ perception of their AI use is positive, and 10% said it is very positive.

Asset managers appeared confident overall in their AI capabilities versus the competition. More than one in 10 (13%) said they are more advanced with AI than other firms, 71% believe they are quite advanced, 15% said they are comparative, and just 2% said they are falling behind.

AI has already found a strong footing across the firms spoken to, with 91% of respondents saying autonomous agentic AI is ‘important to their business.’ Only 2% described it as ‘critical’ though.

In terms of where AI has had the biggest positive influence on client engagement, asset managers taking part pointed to AI-powered support, Q&A, automated client communication and reporting.

Souvik Das, CTO at Clearwater Analytics, said: “AI is transforming the client–manager relationship from a periodic, product-led interaction into a continuous, data-rich partnership where transparency, customisation and demonstrable analytical edge are key to winning and retaining institutional mandates.

“The technology is no longer just about improving performance; it’s redefining what good service looks like. Institutional investors increasingly expect real-time insight, tailored solutions and explainable decision-making, raising the bar for the entire industry.”

This article first appeared in our sister publication, Portfolio Adviser.