Whether you’re looking to buy, build or partner with an investment professional to bring your separately managed accounts (SMAs) solution to life, there are many benefits to making the switch.
“The extra client time is the most important benefit of using SMAs. We work with a lot of clients who have a high level of complexity around their circumstances. SMAs have allowed us to reinvest that time in areas that really matter to them.” - Julia Schortinghuis, Lighthouse Capital.
Advisers using SMAs cite increased transparency, improved efficiencies and practice growth as some of the key benefits in using SMAs.
Unlike managed funds, SMAs offer a level of transparency that clients really respond to. By having a beneficial interest in the underlying investments, clients not only benefit from being able to view the individual performance of each asset but they also directly receive dividends and franking credits. This control and accessibility often translates into increased engagement.
“One of our younger high net worth clients said he had felt really disengaged from super for many years. It was a black box. He really had no idea where his money was invested. Now he has an SMA, he can see the underlying assets. It makes him feel more connected with his investments and more confident of outcomes.” - Julia Schortinghuis, Lighthouse Capital.
With more time to spend on portfolio management and asset selection, Dane Pymble and Bernard Gresser of Infinitas Asset Management have attributed improved investment performance to the use of SMAs in their business.
“You get multi-faceted efficiency gains. We stopped being an administration house and pushed all that effort into research, strategy development and client management.”
Since implementing SMAs, they have experienced an 85% drop in administration tasks.
Other firms are spending the time they’re saving using SMAs to provide a better client experience. They’re doing this by spending more time on the review process, looking at each client’s individual situation in more depth.
The business growth benefits that come with using SMAs, while clearly linked to both transparency and efficiency, may originate from unexpected sources.
Earlier this year, the Macquarie Accounting and Financial Services Benchmarking Report was released and shows 64% of high-performing firms believe that retaining key quality staff is one of the most effective strategies to improving profitability. Firms using SMAs are finding that staff engagement is soaring as they’re now able to focus more on their career development opportunities and less on repetitive administration tasks.
“The staff love it – and our clients see a clean, efficient operation. This wasn’t just an oil change – it was an engine rebuild.” – Dane Pymble, Infinitas Asset Management.
In addition to staff engagement, by reviewing the benefits that the automation and digital aspects of SMAs bring to their business, Dane and Bernard were able to clean up and further digitise back office tasks that they may never have thought to look at previously. This has created even further efficiencies, freeing up more time to spend on business growth.
“Now we’re through the transition, we can focus on the business and our clients and put our growth strategies in place. That’s the real opportunity”
This information is provided by Macquarie Bank Limited AFSL 237502 and does not take into account your objectives, financial situation or needs. You should consider whether it is appropriate for you.