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‘Record number’ of advisers using managed accounts

A new report has revealed that more financial advisers are turning to institutional-style investment vehicles to better manage client funds.

State Street Global Advisors (SSGA) and Investment Trends’ Investment Trends Managed Accounts report found that a “record number of advisers are using managed accounts despite challenges such as extreme market volatility and rising inflation.

The research showed that over half (53 per cent) of advisers are using managed accounts; a significant increase from 16 per cent a decade ago.

60 per cent of advisers are now also recommending managed accounts to their clients, up from 44 per cent last year and 33 per cent pre-COVID (2019).

“Advisers are telling us they like to use managed accounts because they provide access to institutional-grade investment management, efficiencies of scale, and more scope to focus on educating their clients and meeting client goals,” SSGA Head of SPDR ETFs Australia & Model Portfolios for EMEA and APAC, Kathleen Gallagher, said.

“Almost half of advisers who outsource investment management through managed accounts also said it reduced their operational risk. This is because managed accounts are typically used across multiple clients.

“Instead of having to manage individual investment portfolios, advisers can streamline their advice and investment management processes. Less intervention on a client-by-client basis reduces the probability of something going wrong at the individual trade level.”


Separately managed accounts were found to be the most popular, with over 80 per cent of advisers opting for this option, while near 50 per cent users recommend multi-asset class models.

On a recent episode of the ifa Show, BT’s head of managed accounts Zac Leman and head of platforms Chris Mather discussed how managed accounts have gone from a niche to mainstream offer for advisers over the past 20 years and why the pandemic has accelerated its importance.

“They’re becoming the go-to solution for many advisers and they can be purpose-built for boutiques as well as large advice practices,” Zac said.

Chris added: “It’s also a really good way to manage the cost of delivering advice. And there’s a consistency that all clients are getting exactly the same investment outcome without operational delay of implementation activities.”

Listen to the full episode here.

Neil Griffiths

Neil Griffiths

Neil is the Deputy Editor of the wealth titles, including ifa and InvestorDaily.

Neil is also the host of the ifa show podcast.