Managed account FUM steady

For the six months to 31 December 2018, funds under management (FUM) in managed accounts was $62.12 billion, which is slightly down by 0.5 per cent (or $0.32 billion) on the FUM for the previous six months of $62.43 billion.

However, bucking this trend, the net funds inflow from 1 July 2018 to 31 December 2018 was a healthy $2.49 billion or a 4 per cent increase on total FUM.

These were two of the key findings coming from the bi-annual Managed Accounts FUM Census.

Commenting on the findings, the Institute of Managed Account Professionals (IMAP) Chair, Toby Potter, said overall, the result was encouraging, given the dual headwinds of the extensive uncertainty that was evident over the July to December 2018 period. He said the uncertainty was chiefly driven by the likely recommendations of the Hayne Royal Commission and the volatile market conditions during the six month reporting period.

“The census returns tell us that very few investors became worried by the market volatility and other news. The vast majority of investors clearly had a good understanding of their investment strategy, and that they are working closely with their investment adviser to maintain their strategy to achieve their long-term goals,” Potter said. “This speaks volumes for the ‘value added’ service provided by financial advisers to their clients.”

The Managed Account FUM Census is a bi-annual study of the FUM invested through the main forms of managed accounts, including SMA, MDA and IDPS-like services. The survey is conducted by IMAP in conjunction with global actuarial firm, Milliman.

In addressing the results, Milliman (Australia) practice leader, Wade Matterson said the volatility in investment markets in the last half of 2018 was highlighted by the value of the ASX/S&P 200 Accumulation Index decreasing by -6.83 per cent over the six month period.

Forty-three companies participated in the latest Managed Accounts FUM Census. This included reporting for one new entity and the reduction of one entity, as industry consolidation onto the large platforms continues. Survey participants range from the very large (major platforms and banks) and MDA providers, to individual licensees that largely operate their service internally.

“We know there are a number of MDA providers who are not yet participating in the IMAP FUM Census and we strongly encourage those organisations to get involved with IMAP’s Census,” Potter said.

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