InvestSense deal reflects strong adviser focus for Betashares
Betashares chief executive, Alex Vynokur, has said that the firm is focused on financial advisers “more than ever” as it grows the business, having announced a merger with managed account provider InvestSense.
Yesterday (14 July), the ETF provider announced it is set to merge with managed account provider InvestSense to form a combined provider with $8 billion in funds under management, known as Trellia Wealth Partners.
This new entity will operate as a standalone business and offer index-based, active, and bespoke managed account options for financial advisers. Moreover, it will provide technology and tools to enhance business efficiency and help advisers to deliver greater client experience.
The firm said it has witnessed advisers using greater volumes of tailored managed accounts as well as blended active and passive ones, which is something that was lacking from the existing Betashares range.
Once the deal is in place, expected to be in the third quarter of 2025, a key focus will be product innovation in the managed account space, plus consulting and practice development for its partner advice firms to grow and scale their tools and capabilities.
Asked by Money Management whether this represents a renewed focus by Betashares on the financial advice space, Vynokur said the firm sees positive drivers for the market ahead. In addition to the uptake of managed accounts, there is more adviser usage of its core ETF offering.
“One thousand per cent, that is absolutely accurate,” he said. “We have always been focused on it, but now we are bringing that to the next level, more so than we ever have in the past.”
“Financial advisers in Australia are indispensable and a crucial part of the wealth and financial services ecosystem, and we want to support the evolution of the advice industry and continue being a value partner as the industry continues to evolve.
“Our ETF business is going from strength to strength, and this announcement of Trellia allows us to have a more complete offering for advisers in the market.”
As to what has prompted the firm to take this step now, he said the change is that Betashares now has the relationships and resources to enact its plans. Formed in 2009, the firm has $50 billion in funds under management.
“Now we have the ability and the scale to do this right. Fifteen years ago, we were a start-up so we didn’t have the means and the relationships that we do today, and the business has evolved significantly and learnt a lot of lessons.”
Looking more specifically at managed accounts, Vynokur said he can envisage the space being led by a few market leaders in the future, similar to the ETF and the platform spaces where the top three players account for the majority of flows.
As well as Betashares’ deal, Generation Development Group (GDG) merged managed account providers Evidentia, Lonsec Investment Solutions and Implemented Portfolios earlier this year which created a provider with $25 billion in funds under management. At the time, GDG said it could foresee the managed account market growing by 15 per cent per annum to $474 billion by 2030.
Reflecting on Betashares' part in this, Vynokur said: “We’ve been incubating our own managed account capability for the last few years, and we are at a point where we know and we have high conviction that managed accounts will continue thriving, and there is a strong use case for the adviser that allows them to spend more time on delivering strategic advice to the end client.
“I believe there will still be space for boutiques, but as we’ve seen in platform and ETFs, I think managed accounts as an industry will evolve in that direction.”
AUTHOR
Laura Dew
Recommended for you
L1 Capital has confirmed it intends to vote against the conversion of the Platinum Capital LIC into a listed ETF, meaning the deal “has a high probability of failing” due to L1’s substantial shareholding.
Pinnacle Investment Management has continued its focus on international expansion with the appointment of a managing director from T. Rowe Price.
Financial research firm Wealth Data, which publishes the weekly financial adviser numbers, has been sold to fintech firm Padua Solutions.
Betashares is to merge its managed account business with InvestSense to form a purpose-built option for financial advisers, forecasting a positive outlook for future industry growth.
