Collaborating to deliver innovative outcomes

The functionality and technology underpinning the platform is becoming interlinked with the skills and insights of the underlying investment managers, who are working increasingly closely with managed portfolio providers to collaborate and deliver technology that embeds asset management capabilities in the platform.

Australia is exceptionally well-serviced by many of the largest, most sophisticated and innovative asset management firms in the world. The rise of managed portfolios as a vehicle for delivering investment solutions to clients is enabling advisers to tap into those managers’ expertise and capacity to innovate.

An adviser who chooses to take on the responsibility for creating investment solutions for clients, will therefore be required to take on more and more of the characteristics of professional portfolio manager – or to hire-in that expertise in the guise of asset consultants, or from fund managers directly.

If the ultimate aim of investing a client’s money is to achieve the best return for a given level of investment risk, then it stands to reason that sophisticated analysis of the risk inherent in a client’s portfolio is integral to achieving that outcome. A growing number of fund management firms are offering portfolio analysis services through managed portfolio providers to help advisers create the best risk-adjusted portfolios for clients that they can.

These are the kinds of services that are only possible where technology is brought to bear successfully to allow complete transparency of portfolio holdings, appreciation of the client’s current tax position, and the ability to fine-tune and adjust a portfolio to achieve an optimal outcome.  Advisers creating their own portfolios combining several investment managers also benefit from the underlying platform technology when implementing their investment strategy.

In markets such as the US and Europe, large asset management firms are routinely providing risk-return optimisation services to advice firms to implement in portfolio construction for clients – and those services are coming to the Australian market as managed portfolio solutions continue to gain traction.

Want to know more? Access the full whitepaper The Future of Managed Portfolios here.