Cohen & Steers: AUM Resilience and the Art of Navigating Volatility

In an era marked by persistent macroeconomic uncertainty, the ability of asset managers to weather volatile markets while maintaining long-term growth is a critical differentiator. Cohen & Steers, a firm long associated with alternative income strategies and real assets, has demonstrated a unique capacity to balance short-term outflows with enduring resilience. As of August 31, 2025, the firm reported preliminary assets under management of $90.4 billion, a $1.8 billion increase from July 2025, driven by market appreciation and net inflows despite intermittent outflows in earlier quarters. This performance underscores a broader narrative: the firm's strategic emphasis on defensive asset classes and adaptive product innovation has enabled it to thrive even as broader markets fluctuate.

The 2025 Volatility Playbook

Cohen & Steers' recent resilience stems from its focus on preferred securities, real estate, and active ETFs-sectors that offer both income stability and downside protection. In Q2 2025, for instance, the firm's AUM grew to $88.9 billion despite net outflows of $131 million, as $2.3 billion in market appreciation offset investor redemptions. This dynamic highlights the firm's ability to leverage market appreciation in its core holdings, particularly in preferred securities, which have gained traction as a hedge against inflation and equity market swings. According to the firm's Capital Market Assumptions, fixed income and real assets are expected to outperform equities over the next decade, a view reinforced by the current high-yield environment and structural undersupply in real asset markets.

The firm's product diversification further bolsters its resilience. Active ETFs, which now constitute a significant portion of its offerings, have attracted new investor segments. These products, combined with Cohen & Steers' emphasis on tax-efficient structures, position the firm to capitalize on shifting investor preferences without sacrificing its core mandate of income generation.

Lessons from the Past: 2008 and 2020

To fully assess Cohen & Steers' long-term strength, one must examine its performance during prior crises. During the 2008 financial crisis, the firm's AUM fell from $33.6 billion in March 2007 to $28.6 billion by Q1 2008, a decline driven by market depreciation and net outflows. However, the firm's proactive risk management-such as reducing leverage and allocating capital to distressed securities-mitigated further losses. A similar pattern emerged in 2020, when 29% of its AUM was concentrated in preferred securities and income-focused funds, assets that historically exhibit lower volatility during equity downturns. These historical precedents suggest that Cohen & Steers' strategies are not merely reactive but rooted in a disciplined, long-term framework for preserving capital.

The Future Outlook: Balancing Yields and Volatility

Looking ahead, Cohen & Steers' Capital Market Assumptions for 2025-2035 anticipate a world of higher volatility, with real assets and fixed income serving as anchors for portfolios. The firm's recent emphasis on preferred securities-offering high yields and tax advantages-aligns with this outlook, as does its expansion into active ETFs, which provide liquidity and cost efficiency. Notably, 94% of the firm's AUM outperformed benchmarks over one year, and 99% over 10 years, a testament to its consistent ability to deliver value across cycles.

Yet challenges remain. U.S. equity valuations, now at levels reminiscent of the dot-com bubble, have prompted Cohen & Steers to lower its long-term return assumptions for equities. This caution reflects a broader industry shift toward income preservation, a domain where the firm has long excelled.

Conclusion

Cohen & Steers' journey through recent volatility offers a compelling case study in asset management resilience. By combining defensive asset allocations, disciplined risk management, and product innovation, the firm has navigated short-term outflows while maintaining long-term growth. As markets grapple with the dual forces of inflation and geopolitical uncertainty, its strategies-tested in 2008 and 2020-position it as a model for sustainable performance. For investors seeking stability in a turbulent world, Cohen & Steers' approach underscores the value of patience, adaptability, and a clear-eyed view of market cycles.