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Cyprus Investment Funds Surge Amid Robust Private Equity Growth

by THEFUTURE.TEAM

Strong Growth In Cyprus Collective Investments

The Cyprus Securities and Exchange Commission (CySEC) reported continued expansion in the collective investments sector, with assets under management reaching €11.4 billion in the third quarter of 2025. The figure represents a quarterly increase of 7.5%, reflecting stronger investor activity and shifts in asset allocation across multiple sectors.

Comprehensive Sector Overview

According to CySEC’s quarterly bulletin, regulators oversaw 312 management companies and collective investment undertakings during the period, compared with 323 a year earlier. The sector includes externally managed and internally managed UCIs, as well as external fund managers. The market structure comprised 46 AIFMs, 44 sub-threshold AIFMs, two UCITS management companies and three entities operating under dual licenses.

Asset Allocation And Investment Trends

Total assets under management were partitioned among various investment strategies: 63% by AIFMs, 17% by AIFMs and UCITS management companies jointly, 10% by UCITS management companies, 9% by sub-threshold AIFMs, and 1% from regulated UCIs managed by foreign fund managers. Within the UCITS segment, 85.8% of assets were directed toward transferable securities, while AIFs, AIFLNPs, and RAIFs notably invested 30.7% in private equity, 17% in real estate, and 14.5% in hedge funds.

Dominance Of Private Equity Investments

Private equity remains a core component of the sector’s portfolios. Multi-strategy capital accounted for 38.9% of private equity investments, followed by growth capital at 34.1% and venture capital at 16.9%. Mezzanine financing represented 0.5%. Additional exposure included equity capital, fixed income, cash and cash equivalents, infrastructure and commodities, each contributing smaller shares to overall allocations.

Regional Investment Focus And Sectoral Exposure

Approximately 69.7% of assets were held within 205 UCIs domiciled in Cyprus, including 11 UCITS, 51 AIFs, 40 AIFLNPs and 103 RAIFs. Of the 230 UCIs in operation, 165 invested at least partially in Cyprus, totaling more than €2.8 billion, or nearly one-quarter of total assets under management. Within these investments, 71.1% were directed toward private equity projects, while 12.8% were allocated to real estate.

Investor Demographics And Sector Specific Investments

Investor profiles differ across fund types. The UCITS segment remains predominantly retail-driven, with retail investors accounting for 99.2% of participants, totaling 8,727 individuals. In contrast, AIFs, AIFLNPs and RAIFs attracted a more diversified investor base, including 64.7% well-informed investors, 26% professional investors and 9.4% retail investors.

Sector-specific allocations included €471.6 million in energy, €106.9 million in fintech, €581.8 million in shipping and €97.9 million in sustainable investments.

An Evolving Landscape

The latest figures underscore a robust expansion of Cyprus’ collective investments sector. With private equity leading the charge, these developments not only emphasize strategic shifts in asset allocation but also highlight Cyprus’ growing prominence as a critical hub for global investment activities.

Mercedes-Benz Posts Higher Profit Despite China Slowdown

by THEFUTURE.TEAM

Mercedes-Benz reported stronger-than-expected second-quarter results, lifting its shares on Tuesday despite mounting pressure from Chinese automakers and a weaker outlook for sales and revenue.

The earnings provided a boost for Europe’s auto sector, where manufacturers continue to grapple with tariffs, softer demand and intensifying competition from Chinese rivals. Volkswagen, Mercedes-Benz and BMW have all accelerated restructuring efforts in response.

Cost Discipline Lifts Quarterly Profit

Mercedes-Benz shares rose as much as 5.9% following the results before trimming gains to trade 3.5% higher by 1118 GMT. The company reaffirmed its profit margin guidance for its core passenger car business after reporting an adjusted return on sales of 4.0% for the second quarter, above market expectations and within its 3% to 5% target range.

“In an environment where some automakers are ringing alarm bells on their competitive positioning, Mercedes delivered a clear and confident message,” Morningstar analyst Rella Suskin said.

Second-quarter operating profit increased 22% to €1.5 billion ($1.7 billion), despite a 3% decline in revenue. Lower administrative and research and development costs, together with strong performances from the financial services and vans divisions, supported earnings, while the results also included a €131 million gain related to the planned sale of leasing subsidiary Athlon.

China Remains The Key Pressure Point

Despite stronger profitability, Mercedes continues to face a challenging market environment. Sales in China fell 30% during the second quarter, prompting the company to abandon earlier expectations for stable car sales and group revenue. It now expects both to decline slightly from a year earlier.

BMW also lowered its outlook in June following a deeper-than-expected slowdown in China, highlighting the pressure facing Germany’s premium carmakers. At the same time, Mercedes said Chinese manufacturers are increasingly expanding into European markets, although Chief Executive Ola Kaellenius said their focus remains on higher-volume segments rather than the premium market.

“But that is not a reason to sit back and be relaxed,” he said.

Manufacturing Shift Continues

Mercedes is also reshaping its manufacturing footprint. The company said its German factories will undergo a more aggressive push toward leaner production, although it declined to provide further details while talks with labour representatives continue. Production is also being expanded in lower-cost Eastern European locations, including Hungary, where the company is increasing capacity at its Kecskemet plant, as well as in Poland.

Chief Financial Officer Harald Wilhelm said the full-year margin for the passenger car division is expected to come in at the lower end of the company’s guidance range, reflecting a higher share of electric vehicle sales in Europe, which remain more expensive to produce and continue to weigh on profitability.

“We must continue to work flat out to reduce costs so that we can remain competitive on the prices of our products,” Kaellenius said.

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