Almost 75% of fund groups expect the performance fees to rise this year according to research by Skandia Investment Group (SIG).

The research, part of a broader study into the future of fund management, revealed an overwhelming number of asset management companies around the world believe the use of performance fees will increase across a range of asset classes this year.

SIG said this trend is likely to be driven partly by the increasing influence on the retail funds marketplace of hedge fund and institutional managers.

Equity funds and absolute return vehicles are the ones that most expected to see use increase although greater prevalence of performance fees was also expected in fixed interest and property sectors.

Around three quarters of those surveyed said they expect the fees for active asset management to reduce this year.

The study questioned senior executives at over 60 fund management groups with combined assets under management of over $7 trillion.

"The asset management industry is under increasing pressure to demonstrate its commitment to producing value for investors," commented CEO at SIG Nils Bolmstrand. "One way active fund managers are seeking to do this is by aligning their own interests more closely with those of investors through the use of performance related fees."