Platforms ‘big winners’ of wealth exodus

By Adrian Flores
 — 1 minute read

New-generation platforms have been the greatest beneficiary of the wealth management exodus of the major banks other than compliance organisations, notes an industry consultant.

Speaking to InvestorDaily, Forte Asset Solutions managing director Steve Prendeville cited statistics from the Institute of Managed Account Professionals that noted a 9 per cent rise in funds under management (FUM) in the last 6 months to June of $5.389 billion and a 30 per cent rise over the financial year, or $14.46 billion, for a total industry FUM of $62.43 billion.

“We saw the very successful listing of Netwealth and the extraordinary pricing of some of the previously listed platforms reflecting the expected growth due to the migration of advisers and associated funds under management (FUM),” Mr Prendeville said.


“Panorama Investment platform announced their reduction of fees to 15 basis points to come in line with competitors. We will soon see other incumbents move their pricing as well to maintain competitive positioning to retain FUM.

“The interest on cash accounts needs to be considered when looking at total cost as does transactional costs.”

Mr Prendeville noted dealer groups and self-licensed financial advisers are increasingly bringing their asset management in-house, with many of them using independent asset management consultants to assist in portfolio management and ensure best practice and best-of-breed.

He also added that the most common approach is having a hub and spokes model, the hub being low-cost index funds or the five-core risk profile portfolios and the spokes being direct or alternative assets and/or managed funds for alpha with tactical asset allocation.

“Many private client or family office in-house fund managers/asset managers are cascading their intellectual property down to select new licensees; an example is DFS Portfolio Services who have an impressive record of benchmark out-performance, with a risk-based objective of maintaining the integrity of risk-profiles of investors,” Mr Prendeville said.

“Vertical integration is a key focus for the royal commission and it is expected/hoped that they will look to the UK experience whereby you can have ownership of two parts but not all three of the value chain of advice, platform and asset management.”


The must-attend event for financial advisers is back in 2022: the ESG Summit, coming to Sydney and Melbourne in February. Walk away with vital knowledge on a number of key ESG areas to help you make informed ESG strategy decisions and to better communicate and integrate the growing ESG space to clients. Visit the website to secure your place.


Platforms ‘big winners’ of wealth exodus
Trophy big winners
ID logo


related articles

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.