SMAs leading platform innovation
|
|
Platform innovation is currently being spurred by the increasing popularity of separately managed accounts (SMAs), according to Brandt Page, director of independent fund distribution and advisory business Fortuna Partners.
He said platforms have struggled to service high-net-worth investors with the array of different assets available.
Head of Macquarie Adviser Services Tony Graham said the attractiveness of SMAs lies in their model portfolio capabilities.
Graham said Macquarie is looking to create model portfolio capabilities within a wrap and will be there within the next year, because this is sure to be a platform differentiator.
AXA’s general manager of platforms Steve Burgess said SMAs are not necessarily a competitor to wraps.
"They can complement a wrap offer and we’ve seen certain players taking a leap in that area," he said, referring to Aviva. "Certainly our view is that SMAs should be incorporated into an overarching wrap offer, to complement the offer."
Burgess said platform providers are reacting to investor demand for more control and flexibility, and the fact that more advisers are recommending SMAs.
Praemium managing director Arthur Naoumidis said the industry move to fee-for-service is changing the financial services landscape, including platforms. He said planners have had to put their clients into products that paid commissions, but once they move to fee-for-service they can put their clients’ money anywhere, including direct equities.
Cameron Dickman, retail general manager at Australian Unity, agreed that platform developers are looking towards equities and how platforms transact with other assets.
"From our investment point of view, we are dealing with a range of SMAs because we definitely believe they will evolve and take a very significant place in the market over time," he said.
Paragem managing director Ian Knox said there has been little or no platform-led innovation over the last few years. Rather, providers are reacting when they experience a market squeeze. Knox said the current economic climate has put the spotlight on cost-structures and value propositions.
Recommended for you
Digital advice tools are on the rise, but licensees will need to ensure they still meet adviser obligations or potentially risk a class action if clients lose money from a rogue algorithm.
Shaw and Partners has merged with Sydney wealth manager Kennedy Partners Wealth, while Ord Minnett has hired a private wealth adviser from Morgan Stanley.
Australian investors are more confident than their APAC peers in reaching their financial goals and are targeting annual gains of more than 10 per cent, according to Fidelity International.
Zenith Investment Partners has lost its head of portfolio solutions Steven Tang after 17 years with the firm, the latest in a series of senior exits from the research house.
