Triple 3 Partners was established in 2009 to provide volatility strategies to institutional clients, including alpha strategies, volatility overlay and volatility research.

The fund, which is distributed by Grant Samuel Funds Management (GSFM), aims to generate long-term absolute returns with its volatility-focused strategy to capture alpha from highly liquid exchange traded VIX options.

While volatility has traditionally been seen as a measure of risk, it is also an asset class in its own right, and one that offers an often-overlooked source of portfolio returns that are generally uncorrelated to equities.

“Volatility is a unique asset class that offers a largely untapped source of alpha for investors’ portfolios. With low correlation to other asset classes, it can be used to enhance returns and manage risk,” says Mr Damien McIntyre, director and head of distribution with GSFM.

“An investment in volatility can be accessed through the VIX with the use of options and volatility derivatives – which are a good natural diversifier,” Mr McIntyre says.

“Portfolio diversification is a particular issue for Australian investors – who have a definite home bias when it comes to local equity exposure and who, per capita, have the second highest equity exposure globally.

“The Triple3 Volatility Advantage Fund provides an alternative portfolio diversification option in this environment.”

VIX options generally, have been one of the fastest growing option markets in recent years and now rank up with the world’s most liquid – sometimes trading over 1 million options contracts per day.

The addition of the Triple 3 Volatility Fund to Macquarie Wrap follows the fund receiving a “Recommended” rating from research house Lonsec in August.

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Macquarie has added SMAs to Macquarie Wrap.

Macquarie has announced the launch of separately managed accounts (SMAs) as an investment option on its market-leading platform, Macquarie Wrap, enabling financial advisers to view and manage their clients’ assets on one streamlined and consolidated platform.

Justin Delaney, Head of Wealth Product, for Macquarie’s Banking and Financial Services Group, said Macquarie is committed to continually investing in and enhancing Macquarie Wrap to deliver efficiencies to advisers.

“The growing interest in managed accounts in Australia has become more apparent in recent years, with investors embracing the ability of SMAs to take the complexity out of managing an investment portfolio,” Mr Delaney said.

“The decision to add SMAs to the Macquarie Wrap platform was driven largely by client demand for more tailored investment solutions and a wider selection of assets. SMAs combine professional investment management with the transparency, flexibility and tax efficiency of direct ownership.

“We believe adding a discretionary portfolio like an SMA to Macquarie Wrap will provide significant opportunities for advice practices incorporating them into their businesses, as well as improved client experiences and investment outcomes for investors.”

Through Macquarie Wrap, financial advisers and their clients will have access to an extensive range of SMAs, managed by experienced investment managers and covering a range of asset classes, strategies and styles, allowing the construction of a unique portfolio tailored to a client’s needs.

“Investors can hold term deposits, managed funds, direct shares and SMAs on Macquarie Wrap, and receive a complete view of their total investments in one place, with one consolidated report,” Mr Delaney said.

“We have been providing managed accounts for over 15 years, giving us a depth of experience within the industry. We have a fully resourced team of investment professionals and analysts to help make informed decisions about clients’ investments.

“With our strong focus and commitment to providing the highest quality financial services products to our clients, we look forward to delivering the benefits of SMAs to financial advisers and investors.”

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David Heather

Melbourne-based advisory firm Moran Howlett Financial Planning has become the latest boutique to launch a managed discretionary account (MDA) solution, which will ultimately see it phase out traditional wrap platforms and clunky SMSF administration software.

The firm, which has approximately 350 clients and $160 million in assets under advice, has signed a deal to integrate the MDA solution of managedaccounts.com.au following an extensive investigation process which involved four other parties.

Moran Howlett Financial Planning will transition the majority of funds under advice onto the MDA structure over the next few years.

The self-licensed practice, which was established in 2012 through the merger of Paul Moran Financial Planning and Personal Wealth Advisers, is run by principal advisers Paul Moran and Cameron Howlett. It currently uses Westpac’s Asgard platform, Macquarie Wrap and SMSF software provider, Class Super.

According to Moran, who is a Certified Financial Planner, SMSF Specialist Adviser and former Australian Financial Planner of the Year, the MDA solution will dramatically reduce the firm’s administration workload, boost efficiencies and lead to enhanced returns for clients through lower administration costs. “As a mature business, we needed to go up another level in terms of efficiency and an MDA solution will deliver that efficiency plus greater flexibility,” Moran said.

“Over the years, platforms have been useful but they don’t incorporate term deposits into their models, and their integration of managed funds and shares is weak. As a result, we’ve been managing over 400 individual term deposits which are monitored and renewed with ongoing client correspondence.”

“Our clients automatically expect us to make those sorts of investment decisions on their behalf and they don’t understand why we have to keep asking them. It’s our single biggest administration burden.”

However, the group’s new MDA solution will remove that burden. It will be able to build enhanced and more comprehensive investment portfolios and make discretionary changes with the potential for improved returns due to lower administration fees and more timely management.

Moran believes that interest in managed accounts will accelerate in the next six to 12 months, as the debate moves away from commissions and regulatory reform to focus on client service.

The failure of the major platform providers to deliver promised managed account capabilities will only fuel the movement, he said.

“I’m not confident the big platforms will be able to deliver the right functionality because platforms try to be all things to all people and that naturally involves compromises,” Moran said, adding that managedaccounts.com.au’s partnership with global technology giant SS&C was a major determining factor.

“managedaccounts.com.au weren’t trying to convince us that they would build the technology we needed,” he said. “That was a good thing because, in our experience, everyone promises stuff they can’t deliver and certainly not in a reasonable time frame. When they do finally deliver it’s never what you expected.”

David Heather, CEO of managedaccounts.com.au stated ‘’We are pleased to have been selected by Moran Howlett to deliver a managed account solution. We are particularly pleased that our ability to create a solution specific to Moran Howlett’s requirements has been the key criteria in managedaccounts.com.au being selected.’’

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The Fund takes a differentiated approach to investing in Asia, which is largely dominated by quasi-index funds rather than fundamental bottom-up stock pickers. This formula has seen the Fund deliver a total return¹, since inception in 2008, of more than 190%, outstripping its benchmark² by more than 170% and achieving a 12 month return after fees, as at 28 February 2014, of 42.4% (a 31.0% excess return compared to the associated Index, the MSCI Asia (ex-Japan)).

PM CAPITAL’s Head of Distribution, Rob Thompson said, “Advisers want a managed funds menu that suits their diverse client base. We feel this product provides an addition to the Macquarie Wrap offering, which will help meet demand for Australian-domiciled investments that capture growth opportunities in global markets.”

The Fund is ranked the number one Asian equity fund over its five year history by Morningstar for its peer category and was nominated in 2014 by Morningstar in the best undiscovered manager category.

PM CAPITAL’s approach to investing in the Asia Region (ex-Japan) is focused on the rapidly evolving economies in Asia, with a reduced reliance on fixed asset investment in favour of domestic consumption, driven by individuals and private enterprise.

Kevin Bertoli, the Portfolio Manager of the PM CAPITAL Emerging Asia Fund said, “Within the Asian Region (ex-Japan) we are finding genuine value in industries that are supported by rising domestic consumption levels or that are benefiting from changes to consumer consumption patterns. The evolution of over four billion consumers in the Region creates an enormous investment opportunity.”

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1. Past performance is not a reliable indication of future performance. On an annualised basis, the Fund has delivered a return since inception of 202.3% pa versus the benchmark return of 19.0% pa.

2. See www.msci.com for further information on the MSCI and their indices.

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In its tenth year, the May 2013 Planner Technology Report is an in-depth study of Australian financial planners and their technology needs. The study is based on a survey of 1,141 financial planners concluded in May 2013.

“At an industry level, planners’ satisfaction with their most-used platform increased for each of the 27 different areas that we measure,” said Investment Trends Senior Analyst Recep Peker. “Following last year’s record satisfaction, these increases have resulted in planners’ overall satisfaction with their platforms reaching the highest level we’ve seen in the ten years of this study.”

While platform providers have made many new enhancements in the last 12 months, the new lower-cost and flexible pricing models have been the most successful in driving planners’ satisfaction.

“netwealth had the largest increase in overall satisfaction, taking the top spot among platforms,” said Peker. “Planners interviewed were especially happy with its new low-cost Super Accelerator solution, with a number also citing international share trading and the availability of multiple insurance providers.”

The top three platforms by planner satisfaction were:

1. netwealth
2. Macquarie Wrap
3. CFS FirstChoice

“We find there’s a strong link between platform satisfaction and switching behaviour, and the most recent trends saw planners’ loyalty to their platforms reach a high point,” said Peker. “Only 19% said they would change any of the platforms they use if it were up to them, compared to a high of 32% saying so as recently as in 2008.”

Usability is the next frontier for platforms to address

As platforms address the gaps in pricing, the landscape of how platforms can help planners has changed.

“Especially for the past few years, the number one improvement planners have asked from platforms was more competitive pricing,” said Peker. “However, with the introduction of lower-cost solutions, planners now want platform providers to help with online usability, for improved business efficiency, better client reporting and review tools, which is mostly FoFA driven, and better adviser support.”

Westpac holds over a quarter of primary platform relationships

Westpac is the largest platform provider by primary planner relationships, with the proportion using a Westpac platform the most for new inflows increasing from 10% ten years ago to 26% as of May 2013. Westpac is followed by CBA which holds 19% of primary relationships, up from 9% in 2004.

On an individual platform level, CFS FirstChoice and BT Wrap are still the most-used platforms, followed by North and Asgard Infinity eWRAP, both of which achieved substantial increases to the number of primary relationships from 2012.

The four largest platforms by number of primary relationships were:

1. CFS FirstChoice
2. BT Wrap
3. North
4. Asgard Infinity eWRAP

Primary and secondary platform relationships now and ten years ago

The platform market has gone through significant consolidation over the last 10 years:

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