Nick Dignam from Fortitude Investment Partners shares insights with Lachlan Maddock from Fortitude Investment Partners on how a diversified portfolio in mid-market private equity is structured. The Inside Adviser
The world of alternative investments is at a crossroads. As markets defy expectations and liquidity concerns take centre stage, investors find themselves forced to rethink how they deploy capital in an increasingly complex environment.
Managed accounts investment swells to $135 billion despite market headwinds
The trend towards managed account investment continued in the first half of 2022, with total funds under management (FUM) increasing another $3.4 billion despite market volatility buffeting the value of most existing accounts.
Positive inflows saw the value of managed accounts in Australia reach $135.8 billion to 30 June 2022 according to the latest data from The Institute of Managed Account Professionals (IMAP), which conducts 6 monthly FUM audits in conjunction with global actuarial consultancy Milliman.
The inflows negated a 9.9 per cent drop in the value of the ASX/S&P200 Accumulation Index over the six month period, which Milliman practice leader for Australia Victor Huang characterised as a “turbulent period in the investment market” that delivered “sell-offs across both equities and fixed interest”.
Since managed accounts – which include a number of different fee-based investment products – came to market in Australia the uptake as steadily increased from around $10 billion in 2015.
According to Toby Potter, the managing director of IMAP, financial planners have been instrumental in guiding clients towards managed account solutions.
“The investment in client education by financial advisers and investment providers is clearly resulting in a greater focus on clients investing to achieve their longer term goals, and using the structured process that managed accounts provide,” Potter said.
Moreover, the fact that these clients are under advice has led to less panic-selling during the market volatility.
“There has been little sign of clients withdrawing funds when market fluctuations occur,” Potter added. “Plus the efficiencies of managed accounts means that advisers have more time to focus on communicating with clients.”
