Are you looking to service more clients efficiently, while still meeting each individual's unique investment needs? A Managed Account can do just that, leaving you with more time and resources to nurture your business.
Each year, more advice firms are moving to Managed Accounts as new developments and technology make the investment structures more accessible. Today, around 40% of advisers use Managed Accounts – double the number just five years ago – and 25% are thinking about using them, according to research by Investment Trends. The biggest drawcards include greater efficiency, lower costs and superior client servicing; all top-of-mind concerns amid the competitive and compliance-burdened financial advice industry.
The scramble to find the time to meet ever-more stringent best interest and code of ethics obligations has driven many advisors to outsource their business's investment management function to a Managed Account platform. The switch is said to free up around one to two days a week of their time. Outsourcing relieves the advisor from having to keep up with investment markets and boosts the efficiency of their business. The time saved frees them from producing copious amounts of paperwork, such as records of advice for portfolio changes.
Instead, advisors may choose to spend the extra time prospecting for new clients to expand their business and deepening existing relationships to increase retention and referrals. Not only that, but greater business efficiency leads to lower costs. The savings can be used to scale up the business and lift profitability or reduce the cost of advice and attract more clients.
Besides mounting compliance obligations, the industry's changing competitive landscape is also prompting advisors to consider Managed Accounts, which allow them to offer a compelling value proposition against low-cost digital start-ups and heightened client expectations.
Managed Accounts avail customers to the services of a professional investment manager and other investment features that, in the past, were typically reserved for high net-worth clients. Within the Managed Account structure, portfolios are expertly invested in line with the client's risk and return preferences and actively managed to maximise returns and minimise volatility. Not only that, but portfolio changes can be made simultaneously across all accounts, so all clients benefit equally.
Outsourcing the time-consuming responsibilities of investment research, implementation, and reporting also allows advisors to focus on client-facing activities and strategic advice delivery. These being the keys to stronger client relationships that provide more value. Moreover, professional investment management is likely to result in better client outcomes, reducing the advisor's operational risk.
Managed Accounts can also boost client engagement, which corresponds with a better advice business. Under the structure, clients remain the beneficial owners of their assets. This structure offers tax advantages and enhances transparency, a feature that younger investors especially value. The ability to view, track and understand how their investments are helping them meet their financial goals can help clients appreciate the service provided by their advisor. They are thus more likely to stick with their investment plan, and their advisor, should markets turn sour.
In summary, Managed Accounts make your business better by:
If you believe your business could benefit from a Managed Account solution, contact Dynamic Asset today.