Transact to launch own MPS with BlackRock

Transact to launch own MPS with BlackRock

Transact is gearing up to launch a model portfolio service with BlackRock which will see the platform host its own investment proposition for the first time.

FTAdviser understands Transact was targeting a June launch, but the go-live date has been pushed back to August-September time due to delays in finalising legal documents.

Until now, the company has provided its advisers with MPS access via third-parties such as Vanguard.

Transact’s chief executive, Jonathan Gunby, told FTAdviser: “Transact is always considering ways of enhancing the proposition to its clients. 

“We already provide access to MPS through a full range of third-party DIMs [Discretionary Investment Management Services], available to advisers using the Transact platform.”

Model portfolio use is set to increase over the next two years. The main driver behind growing MPS adoption is a desire for greater efficiency as advice firms look for external solutions which let them focus on core financial planning rather than investment management.

Transact is not the only platform operator getting in on the action. Last month, Aviva Investors launched its first-ever MPS, in partnership with SimplyBiz.

Meanwhile, AJ Bell has updated its managed portfolio service to a ‘reliance on others’ basis after finding its MPS “growing in popularity” among advisers.

Transact serves some 167,000 clients. Between October 2021 and March 2022, investors poured £2.68bn into Transact’s platform - the highest ever inflows for the company.

Client numbers also increased 9 per cent and the number of advisers using Transact rose 5 per cent in the period.

The platform has long touted itself as “one of the few companies built from scratch”. In its half-year report, it said it would continue to invest in its proprietary software and systems to ensure it retains its “competitive advantage”.

The plan is to add 50 additional software development and systems staff during the remainder of 2022 and early 2023.

Shares in IntegraFin, Transact’s parent company, have fallen in value by around 57 per cent over the past six month.

The company floated on the stock exchange in March 2018, pricing shares at 196p. Today (July 11), those shares are worth 230p. Towards the end of last year, the share price had sat at 600p.

Gunby told FTAdviser last month that while its parent company IntegraFin has seen a fall in its share price, this has “no impact" upon Transact's strategy. 

“We remain UK only - adviser only," said Gunby. "Indeed, one of the factors affecting the share price is that we announced an increase in future expenses over the next 18 months due to further recruitment. 

"This recruitment enables us to continually improve the platform and service we provide."