Business News

Use of managed funds jumps

SMSF allocations to managed funds increased substantially in 2015, with the asset class the most popular investment choice among portfolios for the first time, according to the latest analysis from OneVue.

According to the December quarter 2015 results for OneVue’s SMSF portfolio holdings, investment in managed funds by trustees increased by 5.10 percentage points to 28.19 per cent from 23.09 per cent in the March quarter 2015.

The result grew from 24.07 per cent and 26.58 per cent in the June and September quarters, respectively.

The asset class was now the biggest for OneVue SMSF advice investors and also posted the largest rise out of all asset classes over the period.

“A key outcome of the survey is that investors are flocking back to managed funds – an asset class that has not recently been top of mind with trustees in SMSF assets that we administer,” OneVue head of product and transactions Brett Marsh said today.

“The popularity of managed funds with SMSF investors has reached the highest level ever in these surveys of OneVue SMSF clients, with more than a quarter choosing this type of asset management for the first time.”

The report found the biggest drop was posted by listed shares, which fell 4.89 percentage points to 21.53 per cent for the December quarter compared to the March quarter.

Further, residential property loans fell by 0.74 percentage points over the year to -5.17 per cent of assets.

Investment in direct property fell to 7.83 per cent, down 1.54 percentage points over the period.

Listed trusts rose 0.93 percentage points to 1.05 per cent of assets.

“The reduction in transitional asset classes for SMSFs – cash, direct shares and property – and their replacement with managed funds and separately managed accounts (SMA) indicates the professionalism that has come in developing portfolios,” Marsh said.

“There’s a world of difference between holding a small number of bank/mining stocks and utilising a professionally managed share portfolio via a managed fund or SMA.

“This level of professionalism in portfolio management is a necessity for trustees as they are likely to weather even more years of market volatility.”

OneVue’s SMSF administration service manages investment data for SMSFs that are mainly receiving professional advice from financial planners and accountants.

These portfolios differ from mum-and-dad SMSF portfolios.

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