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IFAs set to outsource asset management

IFAs set to outsource asset management

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By Adrian Flores ·
August 18 2016

IFAs set to outsource asset management

Independent financial advisors in the UK are looking to outsource the management of a larger number of investment assets according to new research from Cerulli Associates.

IFAs set to outsource asset management
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The research indicated that the IFAs surveyed outsourced 41.7 per cent on average of assets under administration this year, a rise from 41.4 per cent in 2015.

Cerulli Associates Europe's managing director, Barbara Wall, said IFAs expect that figure to climb to 45.9 per cent in 2017.

"Merger and acquisition activity in the financial advice and wealth management market increased exponentially," Ms Wall said.

"It is now slowing, revealing an industry divided between large, multi-service adviser and wealth management companies and small, traditional, independent advisers.

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"The smaller players are more likely to have to outsource investment allocation," she said.

The survey also found that almost two thirds (64.4 per cent) of the IFAs surveyed outsourced to a discretionary fund manager, followed by multi-asset funds and multi-manage/funds of funds, each of which were used by 53.3 per cent of advisers.

More than one third of IFAs (35.6 per cent) outsourced to platforms' model portfolios, with only 2.2 per cent using robo-advisers.

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