The total funds under management in the managed account sector grew $15.8 billion in the six months to July 1, reaching $111 billion according to research from the Institute of Managed Account Professionals in conjunction with actuarial consultancy Milliman.
Driven in large part by financial advisers keen to leverage managed account efficiencies, the sector has now increased $80 billion in the past five years alone, IMAP CEO Toby Potter said, and 24 years after the technology was first employed.
“We can remain confident that the managed accounts advice and investment sector is contributing strongly to wealth management of Australians of all ages,” Potter continued.
“This is positive news and reassuring for investors especially considering the continued high levels of major change across multiple key areas and Covid disruptions.”
The success of managed accounts has come with headwinds and tailwinds; regulatory reform and what Potter calls the “restructuring of the advice market” have been offset by positive market returns.
According to Milliamn’s principal head of investment solutions for Asia-Pacific, Victor Huang, markets have been especially kind during the pandemic.
“The investment markets have kept up the positive tone for 12 months now as businesses adapt to the changing environment,” Huang said.
“There has been some level of continued volatility. Despite this, the value of the ASX / S&P 200 Accumulation Index rose 12.9% over the period, (compared with the 13.2% increase in the prior 6 months).”