Beacon to offer IMAs
BeaconInvestment Management Servicesplans to roll out five types of individually managed accounts (IMAs), after striking a deal last week withIWLto pick the stocks within the various portfolios.
The five portfolios — income, value, growth, 100 leaders and smaller companies — will each average 15 stocks and have a management expense ratio (MER) of 1.4 per cent.
The portfolios will assist planners and clients alike in better management of their investments, and each quarter IWL will advise Beacon on whether there should be any transactions within the portfolios, says managing director Kevin Wyld.
“This way a dealer group can get some discipline into direct share investing. If you approached a stock broker today and asked for 10 income stocks, you’d probably get a different selection than if you approached the same stock broker in three months,” Wyld says.
According to Wyld, the IMAs will also appease professional indemnity insurers, who will be happy to see the discipline IMAs can offer inside a financial planning dealership.
“This way, if planners stick to the (IWL) advice, their clients will have the same portfolio across their whole client base, or at least one of five portfolios.”
There were changes in all five portfolios on April 3 in a process which takes place quarterly, but if there is a major reason to alter the composition of a given portfolio outside this period, then a stock or group of stocks will be traded, Wyld says.
“The portfolios are designed not to have a high turnover ratio and consist of predominantly stable blue chip stocks with no exposure to aggressive high flying stocks,” Wyld says.
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