Individual sleeves show the portfolio tailor’s skill

As portfolio construction goes increasingly modular, asset-class ‘sleeves’ are becoming a very handy tool in an adviser’s kitbag. The appeal of individual ‘sleeves’ lies in their focused design, which allows advisers to create tailored portfolios without compromising the consistency or efficiency that scaleable advice requires.

Rather than constructing bespoke portfolios from scratch, advisers can draw from pre-constructed portfolios and complement this with building blocks such as Atchison’s real assets, liquid alternatives, direct Australian shares or international equities sleeves. This structure allows for sophisticated customisation, aligning with client’s specific preferences, tax position, ethical considerations, or legacy exposures – while still operating within a disciplined framework.

Research indicates that advisers are increasingly adopting modular portfolio components to enhance client satisfaction and retention. For instance, the 2024 Adviser Product and Marketing Needs Report by Investment Trends highlights a significant shift towards the use of exchange-traded funds (ETFs) and active unlisted managed funds in core portfolios, reflecting a move towards more tailored investment solutions.

Atchison’s individual sleeves are designed to complement existing or new portfolio structures across various asset classes. For example, the direct Australian shares sleeve offers a quant-driven, equal-weight exposure to top ASX 100 companies, rebalanced quarterly. This approach provides a transparent and systematic pathway to incorporate domestic equity exposure while satisfying clients who value a tangible connection to familiar local companies.

Moreover, the availability of sleeves from liquid alternatives to illiquid private markets, allows advisers to tailor portfolios with precision to the client’s time horizon, income needs, and liquidity requirements. In a rising interest rate environment, for example, floating-rate sleeves become increasingly relevant. Because their coupons reset periodically with market rates, floating-rate notes tend to preserve capital value and deliver higher income as interest rates rise. This makes them particularly attractive in environments where duration risk can erode returns from traditional fixed-income.

For advisers working with legacy portfolios, individual sleeves offer a pragmatic solution to transition clients without overhauling their entire investment strategy. Instead of a binary decision to fully adopt a model portfolio, sleeves can be layered around existing holdings. This facilitates gradual portfolio modernisation, improves tax efficiency, and supports a consultative, client-centric approach.

Financial advisers should relate to the sleeve approach because it enhances their ability to deliver bespoke outcomes without reinventing operational wheels. It aligns with regulatory best practices by documenting the rationale for asset allocation decisions and promoting consistent implementation across clients. As ASIC continues to emphasise documentation and the best interest duty, having a repeatable but adaptable framework is not just best-practice, it’s essential.

Advisers are also using sleeves as story-telling tools. When clients ask, “Why do I own this?”, the sleeve-based structure allows for clear, purpose-driven answers. Whether the sleeve exists to provide yield stability, global diversification, or access to emerging markets, it reinforces the adviser’s role as a curator of thoughtful investment outcomes.

In summary, individual sleeves offer the ideal combination of customisation, control, and consistency. For advice practices looking to scale without sacrificing personalisation, Atchison’s modular sleeve solutions are a powerful tool. They unlock deeper engagement, better portfolio design, and operational clarity – an essential trio for any forward-thinking financial adviser.

Mishan Dahia