SMAs help Praemium inflows leap

Praemium has reported strong platform inflows for the March 2018 quarter, with gross inflows 39 per cent higher than those of the prior corresponding period at $671 million.

Of this, Australian gross inflows accounted for $484 million, the third highest on record.

Separately managed accounts (SMAs) were a key driver of its performance, with Praemium progressing several strategic initiatives regarding their offerings of this type in the quarter.

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In the quarter, the Praemium SMA added 69 new models, increasing it by 11 per cent. It expanded international models on the Australia SMA with the addition of Franklin Templeton, and also introduced family pricing for the account.

Praemium chief executive, Michael Ohanessian, pointed to SMAs as crucial to future growth, too.

“Looking forward, we expect to see considerable interest in the newly launched International SMA,” he said.

“Providing direct holdings for a client’s offshore equity allocation has often been prohibitively expensive compared to using collective structures; however, the efficiency of the Praemium SMA and the fact that we pass on the trade‐netting benefits to investors helps make Praemium’s international SMA models economically viable.”

The trend towards SMAs would not seem to be disappearing, and Money Management is currently investigating the drivers and winners of this growth. Advisers who complete our survey will be in the running to win a bottle of Penfolds Grange Hermitage.

Funds under management (FUA) for the March quarter was up 5.2 per cent from the December quarter, hitting $7.8 billion. This growth occurred despite sharp declines in equity markets.

“The March quarter was a tough one for equity markets globally with declining valuations and an increase in volatility. Despite an increase in investor uncertainty, we are pleased that our asset inflows held up and our overall FUA increased five per cent over the December quarter,” Ohanessian said.

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