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.
Praemium joins leading platform peloton on reporting, data strength
Praemium has surged to join rivals HUB24 and Netwealth in the leading pack of contemporary investment platforms, based on recent research from Investment Trends that ranked providers based on their overall platform functionality.
In its latest Platform Benchmarking and Competitive Analysis Report, the researcher highlighted data showing not only that Praemium had joined its top tier competitors and turned a ‘Big 2’ into a ‘Big 3’, but that the leading pack had distanced itself from the trailing pack of platform providers.
Praemium increased its overall platform functionality score to 89.9 per cent in the latest report, just behind Netwealth (90.7 per cent) and HUB24 (91.5 per cent).
In the trailing pack, BT Panorama scored 84.7 per cent while Mason Stevens recorded a 83.3 per cent rating.
The top five platforms for usability are all contemporary providers, often referred to as ‘disruptors’ in a market that was once dominated by incumbent platform providers. While those providers – Insignia, BT Financial Group, AMP, Commonwealth Bank/Colonial and Macquarie – still retain larger market share, the delta between them and the trailing pack of disruptors has been narrowing for the better part of a decade.
The apparent reason for that trend, the data indicates, is a far superior level of functionality in the contemporary platforms. Of the incumbents, only BT has a contemporary platform that ranks in terms of functionality – though Panorama’s owner, Westpac/Colonial, has reportedly been shopping the platform around for some time.
Performance uplift
There is a lot on the line for platform providers, with the incoming wave of ‘baby boomers’ swelling the nation’s retirement coffers. Despite the number of financial advisers that primarily use the platforms falling about 40 per cent in the last five years from around 29,000 to just under 16,000, funds under administration is over $1 trillion dollars.
According to Investment Trends, all platforms have uplifted their investment menu in alignment with the the thematics that are driving the industry. Managed account functionality, ESG and retirement income considerations are all prominent factors in 2023, the researcher said.
The performance of Praemium indicates a stark uplift. The platform provider, which bought out competitor Powerwrap in late 2020 before seeing off its own buyout offer from Netwealth last year, is positioning itself as a premium service provider specialising in the wholesale advice market with enhanced reporting functionality.
Praemium has also uplifted its operational performance, taking out individual honours in Investment Trends’ Decision Support Tools and Security, Data and Integration categories for the 2022 report.
According to Investment Trends director Paul McGivern (pictured), security has been another core focus for all platform providers.
“2022 saw all platforms implementing multifactor authentication, but we believe this is only the beginning,” McGivern stated. “Some providers are already exploring behaviour-based alerting to improve their cybersecurity measures – this will certainly be an interesting area to continue to monitor.”
