Praemium’s separately managed account (SMA) has reached the milestone of $100 million funds under management.
This signals the growing acceptance of SMAs as an alternative to conventional managed funds, Praemium managing director Arthur Naoumidis said.
“Whilst it’s early days yet, we believe that this shows that the Praemium/BlackRock SMA is the fastest growing SMA available to Australian investors,” Naoumidis added.
In an exclusive arrangement, BlackRock Investment Managers offers the SMA as the BlackRock Customised Portfolio Service and under white label arrangements.
It can be accessed by 4500 advisers in Australia.
The SMA is on the approved product lists of large dealer groups including Professional Investment Services (PIS), Count, Australian Financial Services, Bongiorno Financial Advisers and Citigroup.
There are around 30 different versions of the SMA and 56 investment models.
“What we’ve attempted to do at BlackRock is really create a very flexible platform that people can create products from,” BlackRock head of customised portfolio service Cormac Heffernan said.
“We’ve seen real innovation in the market with Merrill Lynch and its Bluechip20 and the Alpha Platform from Alpha Structured Investments; an open-ended capital protected equity portfolio.”
Heffernan believes SMA popularity will snowball once more advisers get to grips with the concept.
“It’s a very new product. It really is following the classic new product life cycle. It’s clear that a certain point will hit a tipping point and funds will really start to flow,” Heffernan said.
Direct SMA competitors include ShareInvest, Direct Portfolio Services and Next Financial.
