Advisers hesitant to offer direct investment advice risk losing clients to other firms, says the chief executive of the ASX Listed Product Accreditation Course (LPAC).
LPAC founder Dr Tony Rumble said it is becoming increasingly difficult for advisers to ignore the growing demand for direct investment.
In a statement, chief executive of MDA provider managedaccounts.com.au David Heather agreed, stating that advice practices had been quick to identify the direct investment trend, which has led to the “growing acceptance and popularity of managed discretionary accounts”.
“It’s as if advisers have had an epiphany in the past few years that there’s more on offer than master trusts and wrap platforms,” he said.
“This revelation has prompted many advisers to look at new services such as managed discretionary accounts.”
Dr Rumble said professionally managed direct model portfolio services address many of the barriers associated with offering direct investment advice, such as additional compliance risk and perceived workload and responsibility.
He said direct model portfolio services provide “greater control, flexibility and transparency; the ability to easily and efficiently implement and manage investment decisions; regular reporting and ongoing support provided by the manager, as well as stock research and advice on corporate actions”.
“Direct model portfolios are a ‘do it with me’ solution when a planner contacts the client and a ‘do it for me’ solution when the client enters a separately managed account or a managed discretionary account environment,” he said.
Dr Rumble said it was interesting to see advisers from the bank and life company-owned dealer groups now embracing direct investing.
“There is a definite trend towards adviser’s upskilling and using professional business systems around direct share investing, and this shows how much care good advisers actually do take in their business,” he said.
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