The asset management sector has been upgraded by ratings agency Moody’s for the first time in two years following a period of fund managers patching up their balance sheets and investors moving into higher fee-paying products.

Moody's had downgraded the sector as a whole in April 2008, arguing that many of these companies were holding too much debt and the general economic outlook looked unpromising for investment fee gains. It also marked down several of the global firms it monitored, including Fidelity, Man Group and Legg Mason, as investment losses and redemptions thinned income streams to a trickle.