Skip to main content

Advisers gaining time on managed accounts

Mike Taylor15 March 2024
Count GHG Private Wealth Digital Transformation

Financial advisers using managed accounts believe clients with assets between $250,000 and $1 million are best suited to the product, but new data suggests a growing number of lower balance clients are being tipped in.

The latest SPDR ETFs/Investment Trends Managed Accounts Report has pointed to more advisers seeing lower balance clients (those with less than $100,000 in investable assets) being directed towards managed accounts.

Coming a week after the latest IMAP Managed Accounts Census, the report also confirmed that managed accounts are becoming mainstream with adviser uptake largely driven by the time and cost-savings they deliver, with 59% of those surveyed saying it freed up their time to focus on other tasks.

This was something noted by State Street Global Advisors vice president and ETF Model Portfolio Strategist, Sinead Schaffer who referenced the 59% of advisers citing the freeing up of time and saying that on average 22.8 hours per week was being saved.

“For an adviser who works 7.5 hours a day, that’s a saving of three days per week,” she said.

“As expected, more advisers are using these structures for lower balance clients, with 40% of existing managed account advisers believing it’s appropriate to hold the majority of assets in a managed account for clients with balances less than $100k, up from 33% the previous year.”

Consistent with other research, the SPDR ETFs/Investment Trends report found that most advisers outsourced portfolio construction to professionals with 61% of current managed account users relying on research houses to ensure recommendations complied with best interest obligations.

This compared to 45% who evaluated past performance and 35% who relied on investment manager recommendations.

Mike Taylor

Mike Taylor

Managing Editor/Publisher, Financial Newswire

Subscribe to comments
Be notified of
Inline Feedbacks
View all comments