Report

Discretionary programmes growing 50 per cent faster than non-discretionary, says Cerulli

Discretionary managed account programmes are growing 50 per cent faster than non-discretionary programmes, according to Cerulli Associates.

"Discretionary advisory platform growth has far outpaced non-discretionary programmes and separate accounts over the last two years," says Frederick Pickering, analyst at Cerulli. "Non-discretionary unified managed account programmes have grown faster than discretionary programmes overall, but their small asset base had little effect on overall weighted growth rates."
 
In its Managed Accounts 2014: Confronting Threats report, Cerulli analyses the fee-based managed account marketplace, which has been a core research focus since the firm's inception in the early 1990s. This report, in its 12th iteration, is the result of ongoing research and quarterly surveys of asset managers, broker/dealers, and third-party vendors, which captures more than 95 per cent of industry assets.
 
"Advisors have largely accepted that discretionary account management simplifies their business model and allows for greater trading efficiency," Pickering says. "Having already chosen to place their faith in their advisors by initiating their relationships, few investors feel the need to be consulted before any possible trades are executed."
 
Overall, Cerulli anticipates continued growth in the managed accounts space as more advisors adopt the programmes, and those advisors who already use the platforms transition more clients out of commission relationships.

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