Five key trends in managed accounts

BT has shared the key trends in the managed account space which are expected to continue in 2023.

On the BT Panorama platform, funds under administration in managed accounts increased by 27% to $12.6 billion in the 12 months to November 2022.

Data from the Institute of Managed Accounts Professional (IMAP) also found funds under management (FUM) in managed accounts had risen 22% to $135.8 billion as of 30 June, 2022. 

FUM in separately managed accounts/managed investment schemes increased from $51.09 billion in June 2021 to $70.56 billion while managed discretionary accounts (MDA) services increased from $48.01 billion to $50.64 billion.

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The key trends this year were:

1. Advisers testing the product before they buy

Advisers who are looking to make the switch to managed accounts are making informed decisions based on the large volumes of information available to them. They are also opting to test if the managed accounts work efficiently in their business before opting to fully implement them.

2. Communications amped up during market volatility

BT said timely communication had been key this year with increased market volatility as clients were asking more questions about their portfolios. This had led to investment managers increasing the frequency of information to clients.

However, some were cautious about providing too much information in cause it gave clients a cause for alarm and prompted them to make rash portfolio decisions.

3. Investment managers as influencers

The relationship between adviser and investment manager was evolving and the two parties were in frequent contact. BT noted this increased engagement and in October enhanced the investment managers’ dashboard on BT Panorama, allowing them to easily monitor, verify and edit their portfolios. 

4. Wider selection on platforms  

BT said it expected to grow the number of managed accounts on its platform, which would be near 300 managed portfolios on BT Panorama by the end of the year.

5. ESG interest escalates

Interest in environmental, social and governance (ESG) investments increased by both advisers and clients and available investment options increased. BT said the number of managed accounts with a focus on sustainability had risen from five in 2021 to 12 in 2022, with funds under administration on ESG-focused managed portfolios rising by 238%.