Managed accounts have been labelled a time saver by financial advisers, but the investment approach behind them still remains a critical factor when choosing a provider, according to Zenith Investment Partners.
The research house’s “Unlocking Advice Efficiencies in 2025 Report” found more than 90 per cent of the 460 advisers interviewed agreed outsourcing investment management to managed account experts saved them time for client support.
Zenith Investment Partners head of portfolio solutions Steven Tang said the report, which identified key trends, challenges and opportunities for the advice sector around the use of managed accounts, identified a strong message from practitioners through the adoption of the investment vehicle.
“Our report found strong overall satisfaction: 81 per cent of respondents report being satisfied or extremely satisfied with their managed account provider, indicating broad approval of service quality,” Tang said.
“In addition, managed accounts are demonstrating their value to advice businesses, with 92 per cent of advisers reporting time savings in administrative tasks and 81 per cent expressing overall satisfaction.
“However, challenges exist to their broader adoption. The migration of legacy portfolios, cost considerations and client preferences for bespoke solutions are key barriers to the broader adoption of managed accounts in Australia.”
Beyond these issues, he also noted the investment philosophy, performance and fees behind a managed account were the leading factors considered when choosing a provider, with private-label solutions preferred for their investment philosophy, while off-the-shelf options were favoured for lower fees.
“The report found that 50 per cent of advisers cite investment philosophy as a primary reason for provider selection,” he said.
“This is particularly important for private-label users (60 per cent) and custom managed account users (53 per cent), reflecting the need for tailored strategies to reflect a practice’s investment philosophy.”
He added portfolio performance was a key factor for 47 per cent of advisers in their selection of a provider, while fees were a top concern for 55 per cent of those who used off-the-shelf products, but this dropped to 27 per cent for custom managed accounts and 26 per cent for private-label solutions.
“Managed account providers can help prompt further growth for advice practices by offering technology and tools that streamline investment operations, providing scalable investment management, including portfolio creation, rebalancing, performance reporting and compliance oversight, and enabling advisers to maintain consistent investment solutions for clients, even when transitioning between licensees,” he said.