While top asset managers saw their assets under management increase toward the end of 2017, fee compression is still causing some pain in the industry. A study by Casey Quirk found that assets under management increased 16 percent in 2017, while organic growth from net flows remained low at .03 percent for the firms analyzed. Operating margins rose to 31 percent, up from 29 percent in 2016. However, revenues grew by 11 percent, largely the result of fee pressure. The study notes that revenues were lower from 2015-2016 at negative 1 percent, however fee pressure was only partly responsible for this contraction. In 2017, however, fee compression was the major cause of revenue results. Casey Quirk further reports that 14 percent of the firms analyzed had negative revenue growth in 2017, down from 52 percent in 2016, and 45 percent in 2015. The trend toward passive investing continued, representing an estimated 48 percent of asset flows last year and contributing to a 4 percent decline in industry realized fees, according to the study which points to an increasingly competitive landscape with high-asset firms steadily continuing to gain. Separately, a report from Market Strategies International finds that more than half (52%) of institutional investors with $500 million or more in assets are likely to drop one or more of the asset managers they currently work with within the next year. One of the most cited reasons prompting these impending actions is the desire to switch from an active to a passive manager. According to the report, Vanguard benefits the most from this shift and is the manager most likely to be considered for future mandates by both pension and non-profit institutions.