InvestmentsAug 12 2021

Platform assets see 'Olympic' growth of 6.5% in Q2

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Platform assets see 'Olympic' growth of 6.5% in Q2
BySonia Rach

The assets held on platforms in the second quarter saw growth of “Olympic-style proportions” and another clutch of records, according to a report.

Figures from Fundscape showed platform assets under management hit £865.8bn, up 6.5 per cent.

This follows on from a strong first quarter as assets held on platforms were salvaged by record new business in Q1 and a surprise boom in Q4 as 2020 was “bookended” by activity at the start and end of the year.

Of the £865.8bn reported today, adviser platforms took “a chunky market share” of assets and net sales which contributed 63 per cent. 

Adviser platform assets rose to £545.8bn while gross and net sales totalled £20.9bn and £10.1bn respectively. 

True Potential, the vertically integrated advice and platform business, rose to the top of the net sales table at £1.4bn for the quarter, while Transact came in close second at £1.3bn.

Aviva (£1.2bn), AJ Bell (£1.1bn) and Abrdn (£975m) followed thereafter.

For year‐to‐date net sales, however, Transact topped the net sales leader board at £2.8bn, with Aviva not far behind at £2.7bn.

The same contenders remained in the top five, with True Potential (£2.6bn), Abrdn (£2bn), and AJ Bell (£2bn). 

Meanwhile, the Fundscape data found direct to consumer platforms saw gross flows jump to £41bn while net sales broke through £17bn for the first time on record.

This was spurred on by excess cash and pent‐up demand for investments, tail‐end of the Isa season and the positive momentum from vaccines.

Hargreaves Lansdown’s net sales were up 22 per cent on the previous quarter to £3.7bn, while D2C sales at AJ Bell (£2.1bn), Aegon (£2.1bn) and Fidelity (£1.5bn) were almost neck and neck with adviser channel sales.

Fundscape said the increase in assets was down to restrictions easing and consumers spending more, alongside rising markets with the FTSE All Share rising by 5 per cent in the three months to June.

In the report, Fundscape said: “Indeed, D2C flows are likely to ease in line with lockdown restrictions over the coming months, but business through adviser platforms is expected to remain steady and consistent.”

Bella Caridade‐Ferreira, chief executive of Fundscape, said: “It’s been gratifying to see younger investors take an interest in their finances and invest this past year. Now that lockdown restrictions have eased and normal life is on the horizon, the D2C spike is likely to drop to more normal levels.”

However Caridade‐Ferreira urged that demand for environmental, social and governance, digital wealth management, and low‐cost investment are trends that are here to stay. 

“Demand for advice and investment is strong, but investors want it in a different format,” she added.