Asset managers are vulnerable to a new threat -- this time from tech giants such as PayPal and Amazon, a report from Moody's says. (Photo: Shutterstock)

Asset managers’ inadequate response to the rise of cheap, index-tracking funds has left them vulnerable to a new assault, this time from technology giants such as PayPal Holdings Inc. and Inc., Moody’s Investors Service said in a report.

The industry is “vulnerable to competition from technology-enabled new entrants, particularly with regards to distribution,” Stephen Tu, a senior analyst at the ratings company in New York, wrote in the report published Tuesday.

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