Sinead Schaffer

The rate of growth in advisers taking up managed accounts has plateaued since 2022, but the flow of client funds continues to grow, new research has found.

The SPDR ETFs/Investment Trends Managed Accounts Report, now in its fifteenth year, shows that 56 per cent of financial advisers use managed accounts, unchanged from 2023 and up by just three percentage points since 2022.

The proportion of advisers using managed accounts had grown strongly, increasing more than threefold from 16 per cent of advisers in 2012 to the 53 per cent figure of 2022.

The latest report, based on a survey of 1066 advisers, shows that in 2024 the proportion of “non-user” advisers – defined as those who haven’t used managed accounts and don’t intend to use them in the future – has increased slightly year-on-year from 16 per cent to 19 per cent, but is lower than in 2022 when the figure was 23 per cent.

And the proportion of “potential user” advisers – defined as those who haven’t used managed accounts but may do so within or after 12 months – has decreased year-on-year from 22 per cent to 19 per cent, but is still slightly higher than in 2022, when it stood at 18 per cent.

State Street Global Advisors vice president and ETF model portfolio strategist Sinead Schaffer says the latest figures do not necessarily mean the managed accounts market is saturated.

“We’ve seen it hold steady at 56 per cent usage, but there’s still 20 per cent considering it,” she says.

“That’s a pretty significant chunk of the market.

“So I’d say it’s definitely not saturated, even if you convert half of that.”

Investment Trends chief executive Eric Blewitt says the sector continues to grow rapidly, buoyed by increased flows of client funds from existing users. He says that at the end of December “overall assets in SMA space touched almost $200 billion – $195 billion, to be exact – which is about a 146% increase over the last five years”.