AMP Capital’s new SMSF Pulse tool allows trustees to benchmark their asset allocation against their peers and industry experts.
“Since we launched the SMSF Suite in May last year, we’ve been deliberately focused on how we build out a suite of capabilities to inform, educate and provide insights to trustees on their investments,” AMP Capital head of self-directed wealth and SMSF Tim Keegan told selfmanagedsuper.
“We’ve seen a tenfold increase in visitors over the last 12 months and we’ve also had a significant increase in subscribers to our newsletters, but this [new tool] lifts the level of engagement and interactivity for our customers in terms of thinking about their portfolios.
“It’s designed with SMSF trustees in mind, but we also showcased it out to financial advisers last year [during the pre-launch phase] and they thought it could be quite advantageous for their clients to get them thinking about it before they come in for a chat.”
Keegan said one of the concepts behind the tool was to take offline trustee behaviour and bring it online.
“Last year we ran a series of SMSF trustee events and it was fascinating to watch them in the room comparing investment strategies in detail because sometimes they can feel quite isolated, particularly self-directed investors,” he revealed.
“So the aim here is for trustees to get a sense of how their strategy compares with others based on age and other demographics as a thought-starter in terms of whether they’re comfortable with the strategy they’ve set for their SMSF.”
The second component of the tool allowed SMSF trustees to access comparable data and insights from AMP Capital experts, he said.
“They’ll be able to see how their strategy compares with [AMP Capital head of investment strategy and chief economist] Shane Oliver and the economics team,” he said.
“There have been lots of studies that say asset allocation is the single biggest driver of an investment return, up to 90 per cent of the return of a portfolio, and whilst there’s also a lot of research out there on stocks and individual investments, there’s not a lot of research available for trustees on asset allocation.
“So we think it’s a unique position in terms of being able to demonstrate our approach to portfolio construction and what our weighting is on a month-to-month basis across different asset classes.”
The commentary on SMSF Pulse is updated every month.
“In terms of our dynamic asset allocation approach, our economics unit update their view on the asset classes regularly, so this data will be updated every month,” Keegan said.
“What we saw in our research last year was that there were fairly significant shifts in asset allocation by our trustees, particularly a general move towards a more defensive stance, so I imagine given market volatility, people might start to question whether they should have corporate bonds in their portfolio or if they should contemplate infrastructure and other defensive asset classes.
“I think the tool is something they can go back to regularly.”
He clarified that SMSF Pulse was not an advice tool.
“A significant portion of our trustees, more than half, use an adviser either for full delegation or to validate their strategy,” he said.
“Our aim is to engage very closely with trustees to find out what they want.
“The tool was actually built out of a hackathon as we’re trying to adopt a bit of a start-up methodology around how we build these kinds of tools because they’re really responsive to what customers actually want.
“I’d imagine that SMSF Pulse in a year will be very different to the SMSF Pulse today because we’re going to continue to build out tools that make it easier for trustees to understand and manage their portfolios, and provide them with diagnostic capabilities.”
He said he was thrilled with the growth, level of engagement and take up of the SMSF Suite over the last two-and-a-half years.
“We set aside significant investment on digital innovation to try and continue to improve the services for our trustees and their advisers,” he said.
“There will be lots of new tools [we’ll be delivering in 2016] that make it easier for trustees to engage with each other, and with us, to essentially take their SMSF to the next level.”
SMSF Pulse was launched on 19 February.
