Aust Unity re-enters platform space with managed account vehicle

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Australian Unity has re-entered the platform space with a managed accounts-based vehicle offering equity to investors who use the platform. 

The platform will be promoted and operated by a newly formed group, the Federation Alliance, created by industry experts John Morrison, Stephen Reed, Jan Morrison and John (Monty) Grainger, in partnership with Australian Unity. 

The underlying investments will be managed by managed accounts provider Linear Asset Management, while Australian Unity will act as responsible entity. 

Australian Unity Investments head David Bryant said the platform would be offered to advisers associated with any dealer group. It was not exclusive to planners operating under Australian Unity’s licence, and could be used as an alternative platform for any adviser. 

Bryant said the platform would have comparable costs to its competitors, with a balanced option costing 40 basis points for an investment “in the hundreds of thousands” and falling as funds under investment increased. 

Investors in the platform would be able to recoup some of their investment costs via the equity scheme, which will offer 90 per cent of equity to investors in Federation Alliance, with the remaining 10 per cent indirectly shared between the Federation Alliance key principals and Australian Unity. 

The level of equity offered to investors will depend on their level of usage, which Bryant said allows planners to use the efficiencies of the platform without having conflicts of interest. 

“The approach we have adopted is akin to a co-operative model and fits in with the mutual model that Australian Unity operates under. Depending on the success of the platform it may stay in its current form or even go to a listing, which will be a matter for the shareholders to decide,” Bryant said. 

The platform is the first offering in the space since the introduction of the Future of Financial Advice reforms, and the first for Australian Unity since it withdrew its previous offering, a superannuation vehicle, in 2006.

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