Managed accounts continue to boom, growing 22 per cent over the financial year, reaching a new high of $135.8 billion according to the latest census data.
The Managed Account Census, published annually by the Institute of Managed Account Professionals and actuarial consultancy Milliman, showed the sector has grown over $100 billion in funds under management (FUM) the last six years despite existing for almost two decades prior.
Managed account services achieved the $100 billion FUM threshold at the end of the 2021 financial year.
IMAP chair Toby Potter attributed the growth to client education from advisers and investment providers.
“There has been little sign of clients withdrawing funds when market fluctuations occur,” Potter said in a media release on the results. “Plus, the efficiencies of managed accounts means that advisers have more time to focus on communicating with clients.”
Milliman practice leader Victor Huang said the high inflation, low growth economic environment has meant managed accounts are a vital risk mitigation strategy.
“The continued growth of 22 per cent year on year compares with the decline of 0.5 per cent in total superannuation, despite mandated inflows,” Huang said.
Wide adoption
Research from Investment Trends found most advisers are using managed accounts and are saving roughly two days a week by doing so.
Lonsec acquired Implemented Portfolio Solutions in July to further expand its managed account offering, while the other two major researchers – Morningstar and Zenith – also offer managed accounts.
The extra attention has come with downsides, with the corporate regulator keeping a watchful eye over inhouse products.
Experts have noted managed account proliferation should avoid using the product as an extra revenue stream, arguing efficiencies is enough of justification.
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