Discretionary managed account programmes are growing 50 per cent faster than non-discretionary programmes, Frederick Pickering has said.
Announcing the release of the 167-page report Managed Accounts 2014: Confronting Threats, Mr Pickering, analyst for global analytics firm Cerulli Associates, said: “Discretionary advisory platform growth has far outpaced non-discretionary programmes and separate accounts over the past two years.
“Non-discretionary unified managed account programmes have overall grown faster than discretionary programmes, but their small asset base had little effect on overall weighted growth rates.”
The report said: “As of year-end 2013, total managed account assets reached nearly $3.5 trillion, representing more than 25 per cent growth over year-end 2012.
“Cerulli projects the managed account market will exceed $5 trillion in assets under management by the end of 2016.
“Strong market returns paired with substantial inflows pushed each programme type, except separate accounts, to record asset levels.”
It added: “Cerulli expects the market share of mutual funds and ETFs within fee-based programmes to increase, as advisers move more of their mass-affluent clients into fee-based arrangements to create recurring revenue streams to their practices.”
Adviser view
Colin Low, managing director of Suffolk-based Kingsfleet Wealth, said: “It suggests that, post-RDR, advisers are outsourcing investment decisions. I suspect that advisers don’t feel comfortable selecting funds, but I would argue some do feel comfortable and make good decisions.”
