In its FUM Census, the Institute of Managed Account Professionals (IMAP), in conjunction with Milliman, found that managed accounts FUM reached $144.5 billion, up 9.8 per cent when compared with December 2021’s figure of $131.65 billion.
Toby Potter, chair of IMAP, said: “Inflows of over $10 billion in the past six months demonstrate that managed accounts are a core service for financial advisers to assist their clients target their goals and the market volatility of the past six months has demonstrated this.
“A key advantage is that investment committees, asset consultants and investment portfolio providers are able to quickly effect strategies and tactics to minimise adverse effects from market fluctuations, and then provide tailored information for advisers to communicate proactively with clients.
“It is a much better outcome for advisers to provide explanations of decisions made in the clients’ interests, than to deal with a wave of questions from individuals.”
Mr Potter added that the crunch on advisers’ time with increased compliance and fewer advisers in the industry has, in part, led to the increase.
“A slowing in annual growth from previous levels of 20–30 per cent is attributed by advisers with whom we speak to the pressures that advice has been under over the past 12 months,” he said.
“Anecdotal evidence suggests that a significant share of new client business is being invested through managed account strategies.”
The FUM Census collected data from 47 organisations, with participants ranging from the large platforms and MDA service providers through to individual licensees.
Victor Huang, Milliman’s practice leader, Australia, said: “The investment experience in 2022 has been a story in two parts.
“The positive sentiment in the investment markets in the second half of 2022 delivered a strengthened market with a 9.8 per cent increase in the value of the ASX/S&P 200 Accumulation Index.
“These stronger markets have essentially regained the 9.9 per cent fall in the prior six-month period and demonstrate the value of adhering to your investment strategy.”
Mr Potter said that separately managed accounts (SMAs) were a key part of the growth in managed accounts.
“The SMA sector of managed accounts is growing more quickly than MDA services in large part as the platforms use SMAs as a key distribution effort in the adviser/licensee market, but re-categorisation has had an effect, too,” said Mr Potter.
Can someone direct me to a report that validates the benefit to a client, not based on assumptions or what ifs. An actual study that shows client benefit