SEARCH

IFAs drive managed accounts growth

Independent and non-aligned financial advisers are leading the trend towards managed accounts, which have grown in popularity for the fifth year in a row according to research from NAB and Investment Trends. 

In a statement last week, NAB and Investment Trends released the results of the 2017 Planner Direct Equities and Managed Accounts Report.

According to the report, the IFA market is leading the trend towards managed accounts with 53 per cent of IFAs using managed accounts compared with 47 per cent of aligned advisers.

The report shows that the proportion of advisers using managed accounts increased from 16 per cent in 2012 to 26 per cent in 2017, with a further 20 per cent intending to begin recommending them in the next 12 months.

Advertisement
Advertisement

According to the research, growing client appetite and greater business efficiency for advisers are the main factors driving the growth of managed accounts.

Advisers using managed accounts reported greater inflows and profitability, the statement said.

The average funds under management (FUM) for advisers recommending managed accounts was $55 million, compared with $42 million for non-users. A further 63 per cent of advisers using managed accounts reported improved year-on-year profitability, compared with 56 per cent of non-users.

This could be a result of improved efficiency and reduced administrative/compliance burdens, which enables advisers to service more clients (an average of 131 for those using managed accounts; 106 for those who do not), the statement said.

“What we hear from advisers is that clients want traditional investment specialists, and they like being in the driver’s seat, which is why the control and visibility managed accounts offer is so valuable to them,” Investment Trends chief executive Michael Blomfield said.

“Managed accounts can offer significant tax benefits over pooled structures, so we expect that in the next few years this will lead more clients to opt for them.”

IFAs drive managed accounts growth
default
ifa logo

The must-attend event for financial advisers is back in 2022: the ESG Summit, coming to Sydney and Melbourne in February. Walk away with vital knowledge on a number of key ESG areas to help you make informed ESG strategy decisions and to better communicate and integrate the growing ESG space to clients. Visit the website to secure your place.

Subscribe to the ifa bulletin

Receive daily online news,analysis, reports and business strategies
By signing up you agree to our Terms of Use and Privacy Policy

Website Notifications

Get notifications in real time and stay up to date with content that matters to you.