Surge in new managed funds drives big uptick in financial product regos

A surge in managed fund product launches over the final quarter of 2023 has driven a significant uptick in financial product registration rates, figures from APIR Systems, a wealth industry data analyst and creator of the ‘APIR code’, have shown.

Overall, financial product registrations over the final quarter of 2023 finished 7.2% up on the five-year rolling average for the same period, APIR data showed, representing 199 new product registrations.

The bulk of these gains were driven by a spike in managed investment product registrations, with a total of 183 new products identified over the quarter – up almost 11 per cent on the quarterly average over the past five years.

Nearly two-thirds (62%) of managed fund registrations were categorised as alternative assets, the data showed, with property and mortgages being the dominant investment asset in the alternative class.

“This ties in with 66 per cent of the managed fund registrations identifying as having a domestic geographical focus,” APIR chief executive Chris Donohoe said.

Registrations for managed accounts products, however, bucked the wider trend, trending slightly down on the rolling five-year average. In total, just 10 managed accounts product registrations were recorded over this quarter – an effective “normalisation” of registration rates after a surge in previous years, APIR said.

With six regos in total over the quarter, superannuation product numbers remained in line with the rolling five-year average for the period.

The overall increase in financial product registrations over the quarter was partially offset by 79 product terminations – a 28% increase on the rolling five-year average. However, as APIR noted, this is still significantly down on the year-to-date figure from the previous year.

“Whilst, year-to-date, we have seen lower levels of registrations in some product categories, it is apparent that product manufacturers are still looking to the traditional managed fund as their preferred collective investment vehicle to take to market,” Donohoe said.

Meanwhile, after “extremely strong levels of registrations the previous year”, APIR noted that managed account product registrations appear to be normalising compared to what we have seen in prior years.

Factoring in the likely peak in inflation rates, Donohoe cautioned product manufacturers to “weigh up the likelihood of central banks reducing interest rates against the impact of ever-increasing global instability”.

APIR Systems identifies, codes and manages reference data for unlisted financial products. The firm has identified more than 30,000 individual financial products over its 30 years of operation.