Praemium dominates SMA space: Lonsec


By Julie May

Email Article Print Article

Related Articles: | |

Independent platform provider Praemium is comfortably dominating Australia’s separately managed account (SMA) space, research released today has revealed.

Lonsec specialised research general manager Michael Elsworth told financialobserver Praemium had around $1.5 billion in assets under management within SMA model portfolios, which was a serious chunk of the pie.

Elsworth said Lonsec reviewed five Australian SMA platform providers, which together equated to over $2 billion in total assets under management as at June 2014.

“We looked at five SMA platforms including Praemium, AMP, BT, Macquarie and Powerwrap, which together accounted for over half of the Australian SMA market,” he said.

“As of June this year, Macquarie had $234 million, AMP had $209 million, Powerwrap had $200 million and BT had $70 million.”

He said the figures related specifically to SMA model portfolios and the numbers were substantially higher for each provider when direct equities were included.

“Praemium most likely stood out because they’ve been at it the longest,” he said.

“They’re an independent technology platform, they have the widest menu out of those surveyed and their reporting is very good, arguably the best.”

Lonsec took a two-pronged approach to the research, reviewing investment managers and their model portfolios while also looking at the administrative services provided by the platforms and the underlying technology.

“There was quite a big difference in the way platforms communicated with advisers,” Elsworth said.

“Reporting and interaction with providers was a big factor and it was clear that some made more investment in reporting than others, with the way trades were executed also a point of difference.”

Notable absences from the survey were OneVue and Hub24.

“The timing of the survey did not work in their favour, which was understandable for OneVue as it was in the middle of an IPO (initial public offering), but we really hope to have everyone on board for the survey next year,” Elsworth said.

Lonsec said it predicted continued growth for SMA platforms in the years ahead thanks to greater demand from advisory groups and other investors.

« Back to Articles