Can managed accounts thrive beyond regulatory scrutiny?
The question confronting the managed accounts sector is whether increased regulatory scrutiny will act as a brake to its recent rapid growth?
A combination of circumstances and indeed, technology, have seen managed accounts emerge as one of the fastest-growing segments of the Australian financial services industry.
The circumstances have evolved out of the impact of the Future of Financial Advice changes on adviser and dealer group commercial models, while the technology dynamic has been driven in large part by the platforms, particularly the likes of Netwealth and HUB24.
But with the rise and rise of managed accounts has also come increased regulatory scrutiny and there will be a good deal of attention directed towards what the Australian Securities and Investments Commission (ASIC) concludes from its sharper focus on the sector over the past 18 months.
The priority for ASIC will, of course, be determining who benefits most from utilising managed accounts – the client or the adviser?
However, as Oksana Patron reports in this Guide to Managed Accounts, there are undoubted benefits for advisers, particularly those who like to have a deeper level of engagement with their clients.
But whatever the regulator concludes, the rapid growth in the use of managed accounts over the past four years, and the need for the industry to embrace new commercial models means that the sector is likely to continue to grow.
The key for the industry amid the increased regulatory scrutiny will be proving that just because something works well for the adviser does not mean it is bad for the client.
Recommended for you
In this episode of Relative Return Unplugged, hosts Maja Garaca Djurdjevic and Keith Ford are joined by special guest Shane Oliver, chief economist at AMP, to break down what’s happening with the Trump trade and the broader global economy, and what it means for Australia.
In this episode, hosts Maja Garaca Djurdjevic and Keith Ford take a look at what’s making news in the investment world, from President-elect Donald Trump’s cabinet nominations to Cbus fronting up to a Senate inquiry.
In this new episode of The Manager Mix, host Laura Dew speaks with Claire Smith, head of private assets sales at Schroders, to discuss semi-liquid global private equity.
In this episode of Relative Return, host Laura Dew speaks with Eric Braz, MFS portfolio manager on the global small and mid-cap fund, the MFS Global New Discovery Strategy, to discuss the power of small and mid-cap investing in today’s global markets.
