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AMP Capital developing more SMSF-targeted products

AMP Capital is looking to provided more managed funds specifically developed for SMSF investors in the future as a result of the success enjoyed by the organisation since the inception of its dedicated business unit to service the sector.

“We do have a product development team who are working through a range of product ideas the whole time specifically for SMSF trustees,” AMP Capital head of SMSF Tim Keegan said at an industry roundtable last week.

Keegan did point out the offerings were not ready to be released yet due to the nature of the development process.

“They are in train. The product development cycle can be a bit like private equity [where] you have to have a look at a lot of deals before you choose one that makes sense and we’re very conscious of making sure whatever we launch to SMSFs will resonate with what they actually want,” he said.

The initiative comes on the back of a very successful year for AMP Capital’s SMSF unit, which positively reinforced the approach the manager had decided to apply to servicing the sector.

“We recognised SMSFs are not a fad, that they are here to stay, and we need to play a more active role in this part of the market given that it’s a third of all super monies and the fastest-growing [superannuation] sector,” Keegan said.

“Looking at the first 12 weeks of 2015 versus the corresponding period of the prior year, we have had a fourfold increase in flows into our investments.

“In overall terms we’ve seen a 45 per cent increase in our assets under management from SMSFs in the year ending 31 December 2014.”

In terms of current investment trends, AMP Capital had noted commercial property and infrastructure as asset classes were attracting a lot of attention from SMSF members in their search for alternative sources of yield, he said.

“We are seeing significant flows in [commercial property] because of its consistent yield,” he said.

“We have a fund that’s been running for 30 years and is paying in that zone of 7 to 9 per cent and while clearly there is a risk profile difference [compared to cash], having that as part of their portfolio construction is clearly occurring now.”

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