FUM a 'key influence' on adviser fund selection
A quarter of advisers select managed funds for their clients on the basis of their funds under management (FUM), according to a survey by BDM Direct, a Melbourne-based distributor of fund managers to financial advisers.
The survey of over 800 independent and aligned financial advisers found that adviser rate FUM as high as ‘asset class’ and ‘fund track record’ as a reason for selecting a fund for their clients.
Each of the three categories received were voted by 25 per cent of the surveyed advisers as their primary reason for selecting a fund.
BDM Direct managing director Anissa Cavallo said the advisers’ focus on FUM was a “little surprising”, although their focus on manager fundamentals and asset class reveals an active involvement in investment selection.
'Research’, ‘performance’ and ‘transparency’ were nominated by less than 10 per cent of advisers as the most important aspect in selecting product.
The survey also found more than 60 per cent of advisers were concerned about finding new clients and developing their client database.
Equally, about 40 per cent were found to be apprehensive about finding new products to suit the changing investment horizon.
"Interestingly, very few advisers felt that compliance and administration would create issues for their business in the near future," Cavallo said.
Even fewer were concerned about the quality of business development managers on the market, she said.
Recommended for you
BT is to launch a new low-cost “Focus” investment menu for its Panorama platform this October, in partnership with Vanguard, seeking to compete with industry superannuation funds.
Net gains of financial advisers have already doubled since the start of FY25, according to this week’s Padua Wealth Data, with momentum gathering pace far faster than the previous financial year.
National advice firm MiQ Private Wealth has appointed a new chief executive to lead the business through a “transformative era” after penning a partnership deal with AZ NGA earlier this month.
WT Financial’s managing director, Keith Cullen, believes the firm’s Hubco model with Merchant Wealth Partners will be a “repeatable growth model” for the business as it scales its adviser numbers.
