Flat-fee Macrovue pilot pitched to advisers

Macrovue's adviser platform will offer a monthly or annual flat fee.

09-Dec-2016

By Sarah Kendell

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Online investment platform Macrovue will launch an adviser offering in early 2017 that aims to undercut traditional wrap platforms with an economical flat fee structure.

Speaking to financialobserver, Macrovue co-founder Sid Sahgal said while the platform was created to help consumers invest in international markets easily and cheaply, growing financial planner interest had convinced the group that the broader adviser platform space was also ripe for competition.

“When advisers look at us they see we can do a lot of the stuff that a wrap platform could do – you can buy international and domestic stocks, and do the portfolio management and tax reporting as well,” Sahgal said.

“Wrap platforms are going to become a relic of the past because the world is moving towards cheaper investment products, and with a wrap you pay 60 basis points just to use it, which then gets passed on to the client.”

Sahgal said the group would conduct a pilot of its adviser platform in January, with a view to launching to the broader market soon after.

“We will have a small flat fee with a monthly or annual payment option, and the adviser can use one of our share portfolios or get one from a research house that they can upload into our system,” he said.

“We are doing some interesting partnerships with a company called Fincast that does asset allocation, and their portfolios will feed into ours.

“So what we will offer to advisers eventually is a fully flat-priced solution without ever having to pay those really high fees.”

Unlike most wrap platforms, clients’ costs would not rise as their assets increased, meaning annual fees would remain around $250 regardless of whether clients had a $100,000 or $1 million balance.

Sahgal’s co-founder Dev Sinha said Macrovue was targeting investors who wanted a greater degree of control and engagement in their allocation decisions than the average robo advice user.

“We appeal more to self-directed customers because they want ownership of their investing decisions and they don’t want to be penalised for tax implications in managed fund structures,” he said.

“We are not going head to head with a typical robo-adviser that invests on your behalf – I see it more as a complementary offering.”

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