Managed account FUM could double in three years
Managed accounts funds under management (FUM) has surpassed $100 billion for the first time and could hit the $200 billion mark in the next three years, according to the Institute of Managed Account Professionals (IMAP).
As of 30 June, 2021 FUM in managed accounts stood at $111 billion, an increase of $15.8 billion in the last six months.
In a briefing on its latest IMAP Managed Account census in conjunction with Milliman, IMAP chair, Toby Potter, said the last three years had shown an accumulative average growth rate of over 20%.
“If that growth rate keeps up, inside three years managed accounts will be a $200 billion part of the advice market,” Potter said.
“Trend extrapolations are always a threat but I see no particular reason why this 20% growth rate shouldn’t be maintained over the next two to three years.
“Managed accounts are now firmly embedded part of the way in which advice is implemented.”
The census included 48 companies, which covered separately managed accounts (SMAs) and managed discretionary accounts (MDAs).
“Both parts of the managed account world – SMAs and MDAs – have shown continuing growth and they’re both level pegging at around $50 billion,” Potter said.
Managed Accounts growth by category ($ billions) June 2017 to June 2021
Source: IMAP
Potter said the growth of the sector was positive news and reassuring for investors, given the disruption created by the COVID-19 pandemic.
“The significance is not just that managed accounts have now been used by advisers for 24 plus years, but that in the past five years alone the value of clients’ investment advised through managed accounts has increased by $80 billion,” Potter said.
“We can remain confident that the managed accounts advice and investment sector is contributing strongly to wealth management of Australians of all ages.”
FUM results split between managed accounts type
Source: IMAP
AUTHOR
Chris Dastoor
Recommended for you
Regal Partners has passed $20 billion in funds under management, helped by $723 million in net inflows during the last three months.
Global investment manager Fidante has formed a strategic partnership with a London-based asset manager to secure exclusive distribution rights across the APAC region.
Blackwattle Investment Partners has hired a management trio from First Sentier Investors – who departed amid the closure of four investment teams last year – to run its first equity income offering.
Private markets manager Fortitude Investment Partners has launched an evergreen small-cap private equity fund.
