Discretionary Managed & Model Portfolio Services – Official Defaqto Research Report (2012 Version)
Defaqto have produced the 2nd edition Official Research Report for Financial Advisers on Managed Portfolio Services (MPS). Sometimes called Model Portfolios, the research has been commissioned by Brooks Macdonald Asset Management for a second year and reflects the growth in popularity of packaged Discretionary Solutions as an Outsourcing Solution for Investment Advisers. Furthermore the 2012 Research Report is the result of increasing requests from Financial Intermediaries for updated ''official'' performance evaluations, and comparison tables, both included in the 2012 research report.
As with the 2011 MPS Evaluation Study, the 2012 version looks at all aspects of MPS and underlines the following key areas which Advisers should research and use for in-depth comparison:
- 1) Structure
- 2) Investment Process
- 3) Key Personnel
- 4) Benchmarking
- 5) Performance
- 6) Access
- 7) Fees & Charges
The research focus is primarily on the notion of Benchmarking and Performance when reviewing or comparing MPS Vehicles, but now also offers additional detail son teh development of MPS Propositions by leading Discretionary Managers, and gives Advisers a proxy to the wider Market of propositions now available, either directly or via Platforms, or both.
Unlike Bespoke Discretionary Portfolios there will be limitations to the choice an investor has on the benchmark returns that a fund will aim to meet. It should be noted that MPS Products tend to have four or five Risk Banded Funds and some variety in the Benchmark can be built in, but by and large they follow the same investment focus. The ability of the Investment Manager to meet such a benchmark at the minimum level of risk is seen as the key to a strong product.
MPS use is growing significantly as they allow IFAs with multiple Investment Clients to access the skills and resources of Discretionary Managers at affordable cost levels. Traditionally DFMs have high minimum investment amounts to accommodate the bespoke nature of their work, this removes many IFA Clients out of the equation. MPS is designed to accommodate clients in the £10,000 - £100,000 Investible Assets range.
Competitive products are also growing as the need to outsource investment research and primary decision making grows. Such products include, Risk Rated Portfolios, Governed Portfolios, Unitized Discretionary Funds, Multi-Manager funds and the IMA Balanced Managed Sector.
Click Here to Download a Free Copy of the New 2012 MPS Evaluation Report from
Click Here to Download a Free Copy of the Original 2011 MPS Evaluation Report from
All Defaqto Guides are now Accredited for CPD by the PFS, and the IFP and can be used to support propositin selection and justification.