Planner use of SMAs jump

The number of financial planners and investors using separately managed accounts (SMAs) has jumped to a record high, with 20 per cent of financial planners now using SMAs as part of a client investment portfolio.

Such was the finding of a whitepaper released by JBWere, which found the levels were at 17 per cent in 2014.

Another 23 per cent of planners said they might start using SMAs over the next two years.

Related News:

JBWere chief investment officer, James Wright, said the main reasons for the increase was the significant administrative burdens advisers faced, as well as more education on financial products.

"Financial advisers are feeling the effect of this trend by spending more time monitoring and administering direct investments for clients, which combined with a new wave of regulation, is creating major commercial pressures on their businesses," Wright said.

The JBWere Investment Trends SMA Report, which was commissioned by JBWere earlier this year, found 48 per cent of the 671 planners surveyed said the work involved in keeping track of individual stocks deterred them from investing more in direct shares.

Over half of planners who used SMAs thought they were more suitable for self-managed super funds (SMSFs) clients than direct shares, while most planners thought SMAs offer more advantages to SMSFs compared to managed funds.

A quarter of planners surveyed can now access SMAs on their primary platform, up from 10 per cent, while the number of platforms through which SMAs are available has jumped from seven to 11.

Recommended for you


Add new comment