Advisers seek investment philosophy, performance in managed accounts provider

Investment philosophy and portfolio performance are the main reasons why financial advisers have chosen their managed accounts provider, new research from Zenith Investment Partners show.

The Unlocking Advice Efficiencies in 2025 report found that half the participants cite investment philosophy as a drawcard while the same number say that investment performance is a driving force when it comes to partnering with a managed accounts provider.

The survey of 460 financial advisers also found that fees are a top concern for 55% of off-the-shelf users, compared to 27% for custom managed accounts and 26% for private label solutions, highlighting cost considerations in selection of both provider and managed account type.

Zenith head of portfolio solutions Steven Tang said the report found strong overall satisfaction with 81% of respondents being satisfied or extremely satisfied with their managed account provider, indicating broad approval of service quality.

"In addition, managed accounts are demonstrating their value to advice businesses, with 92% of advisers reporting time savings in administrative tasks and 81% expressing overall satisfaction. However, challenges exist to their broader adoption. The migration of legacy portfolios, cost considerations, and client preferences for bespoke solutions key barriers to the broader adoption of managed accounts in Australia," he said.

The managed accounts sector is growing exponentially as more practices adopt these solutions.

Adviser Ratings founder Angus Wood recently told Financial Standard that managed accounts assets have quadrupled over the past five years to $200 billion and more than 100 active separately managed accounts (SMAs) managers are creating portfolios.

"Every day that goes by there's another $1 billion to $3 billion being modelled into managed accounts. We're seeing it through ProductRex - for $2 that's coming through the advisers, $1 is going into managed accounts," he said.