Masterfund market grows by 20 per cent over past year
The masterfund market has benefited from strong underlying investment performances to increase in size by 20.5 per cent ($86.8 billion) over the past year, with about 60 per cent of this growth coming from investment markets, according to data released by Plan for Life.
In its most recent Platform and Wraps market report released today, Plan for Life stated the strong growth over the 2012/13 financial year lifted total funds under management in masterfunds to $510.3 billion as at 30 June 2013.
While investment performance was the key driver in the sector’s growth, annual fund inflows also increased by 20.6 per cent to $135.2 billion, offsetting and exceeding corresponding outflows of $109.6 billion, an increase of 6 per cent over the previous financial year.
During the most recent quarter - June - the masterfunds market was up $16 billion, or 3.2 per cent, but much of this was due to the shift of the $7.6 billion Perpetual Private Wealth Platform into the Macquarie Wrap business.
Wrap accounts now have $188.6 billion in funds under management and represent 37 per cent of the overall masterfunds market, with inflows totalling $72.4 billion. Outflows of $49.8 billion resulted in overall net fund flows of $22.6 billion - well above that of platforms and master trusts.
Macquarie, BT and AMP each hold about a 17 per cent share of funds under management, followed by National Australia / MLC with a nearly 13 per cent share. BT continues to dominate as a platform administrator, with more than 41 per cent of market share followed by Macquarie with 19 per cent.
Platform funds under management were up 16.3 per cent to $248.1 billion. Annual inflows of $49 billion were offset by outflows of $47.7 billion (43.5 per cent) to provide net flows of $1.3 billion. Six platform providers - National Australia / MLC, Commonwealth / Colonial , AMP, IOOF, OnePath and Mercer - were responsible for 94 per cent of funds under management on platforms.
Master Trusts saw only a modest increase of 8.9 per cent to $73.6 billion in funds under management. Inflows fell year-on-year by 16.6 per cent to $13.8 billion while outflows increased by 5.9 per cent to $12.1 billion, for new fund flows of $1.7 billion.
Recommended for you
Lonsec and SQM Research have highlighted manager selection as a crucial risk for financial advisers when it comes to private market investments, particularly due to the clear performance dispersion.
Macquarie Asset Management has indicated its desire to commit the fast-growing wealth business in Australia by divesting part of its public investment business to Japanese investment bank Nomura.
Australia’s “sophisticated” financial services industry is a magnet for offshore fund managers, according to a global firm.
The latest Morningstar asset manager survey believes ETF providers are likely to retain the market share they have gained from active managers.
