The Cyprus Securities and Exchange Commission (CySEC) has released updated figures for the second quarter of 2025, showing the resilience of the collective investment sector amid global market fluctuations. Despite a slight decrease in total assets under management, Cyprus remains one of Europe’s key investment hubs.
Market Overview: Fewer Companies, Stable Assets
In Q2 2025, CySEC supervised 319 asset management and investment fund companies (UCIs) — a slight decrease from 328 a year earlier. The 2.74% drop is attributed to market consolidation and stricter regulatory requirements.
The total assets under management (AUM) reached €10.6 billion, down 1.03% from the previous quarter. However, the net asset value (NAV) of managed funds remained stable at €9.8 billion, demonstrating resilience despite global economic fluctuations.
Market Structure: Who Manages the Capital
Of the total registered structures:
- 222 funds are managed by external managers,
- 30 by internal managers, and
- 67 companies operate as independent managers.
Among them:
- 45 are licensed Alternative Investment Fund Managers (AIFMs),
- 45 are small AIFMs,
- 2 manage UCITS funds, and
- 5 hold both AIFM and UCITS licenses.
Over 60% of all assets are managed by AIFMs, confirming strong investor interest in flexible investment strategies. Managers holding both AIFM and UCITS licenses control around 17% of assets, while 11% are under UCITS-only companies.
Investment Focus: From Real Estate to Technology
The largest share of alternative fund assets is allocated to private equity (31.6%) and real estate (17.8%).
Investments in hedge funds accounted for 10.3%, while funds of funds represented 9.7%. The remaining 30.6% falls under “other investments,” including equities, debt instruments, and infrastructure projects.
Within the private equity segment:
- 33.7% are multi-strategy funds,
- 31.1% — growth capital,
- 16.2% — venture capital,
- 4.4% — mezzanine financing.
The technology and sustainability sectors are gradually gaining momentum. Investments in fintech reached €106.3 million, and sustainable projects attracted €96.5 million, highlighting the growing importance of EU Green Deal–aligned initiatives.
Investing in Cyprus: Confidence in the Local Economy Grows
More than 73% of all AUM belong to funds registered in Cyprus. These include:
- 12 UCITS,
- 54 AIF,
- 40 AIFLNP, and
- 102 RAIF structures.
Notably, 170 funds invest partially or fully in the Cypriot economy.
In Q2 2025, the total volume of domestic investments reached €2.75 billion, with 70% directed toward private equity and over 13% toward real estate.
Investor Profile: Retail and Professional Clients
According to CySEC, 99% of UCITS investors are retail clients, totaling 8,819 individuals.
In the alternative investment sector, 62.9% are well-informed investors, 25.3% are professional investors, and 11.8% are retail clients — indicating growing retail interest in complex and potentially high-yield investment instruments.
The Cypriot collective investment market continues to demonstrate stability and transparency.
Experts believe its growth will be supported by new CySEC initiatives focused on digitalizing reporting and enhancing investor protection.
In the coming years, the regulator plans to introduce automated risk analysis systems and updated sustainable finance regulations, which are expected to attract more international funds to Cyprus.