Can boutique fundies tap into SMSFs?
Boutique fund managers are trying to grab a slice of the ever-growing self-managed super fund (SMSF) pie, but some are questioning whether it is worth the effort.
Bennelong Funds Management chief executive officer Jarrod Brown said asset managers need to quickly work out a way to get on the SMSF train.
His firm has already seen an inflow of money coming from self-directed investors, but the marketing and strategic challenge remained.
"We see the funds going straight into our investment trusts - and in many cases we have no idea how they [investors] found it," Brown said.
"That's the challenge — when they come in each day we don't know in most cases whether there has been any intermediary involved in advising them, or whether they've seen our performance numbers in the media or seen some of our commentary," he added.
"This is something we'll try and find out; by focusing on our own database we can learn a little bit more about where they come from and perhaps work a bit harder on increasing the same."
However, Hyperion Asset Management managing director Tim Samway said most SMSF trustees were not looking for what boutiques could offer them.
"Having had discussions with a number of SMSF trustees, I get the feeling that they're looking for solutions rather than products," Samway said.
"The complete solution has more to do with the cost of administration rather than the investment product itself," he added.
There is a high level of fee sensitivity that has not been addressed just yet, Samway added.
"They're doing it themselves, but we all know that doing it yourself is not cheap," he said.
"So, product providers, like fund managers, just look like another layer of fee to an SMSF trustee."
Both Brown and Samway agree that another challenge facing boutiques with respect to tapping into specific segments comes from marketing.
"We are already making a push into SMSFs, but the challenge is we don't have a marketing budget like Perpetual or one of the majors," Brown said. "We still make a core strategic assumption that the majority, while running their own self-managed vehicle, aren't necessarily self-directed and that there is usually an adviser involved.
"It's such a large market and it's so diverse; there is no easy way to put a marketing budget and say ‘we'll target this specific segment'," Samway added.
The fact that boutiques are trying to hop on the SMSF train was also evidenced by the number of asset managers attending the SMSF Professionals' Association of Australia National Conference in February, Brown said.
"Everybody is trying to solve the ‘how to access SMSFs' and maximise the opportunity, but I don't think anyone has perfected it yet."
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