It’s evolution, baby Potter said platforms will need to adapt to keep their dominant market share, a shift which may lead to them offering managed fund SMAs and creating customised managed account platforms. “We’ll see the conventional platforms developing tools which make managed accounts practical. That’s probably the biggest change we’re going to see – conventional platforms adding managed account functionality.” Platforms could offer managed accounts where investment funds are central to the service. In this model, platforms could serve as the back-office for an IMA, or an IMA will become a listed product on a platform, he said. The development of managed accounts on mainstream platforms, however, is still at a very early stage. “The simpler models are just going to be portfolio management functionality embedded in the platform. And the more sophisticated models are going to allow distributed trading, so that investment managers can trade on behalf of clients but use the platforms for settlement. So the platforms will begin to look like custodians.” Another service now being offered are the retail superannuation versions of managed accounts. In April this year, BlackRock launched Super SMA, and Aviva Investors launched the first fully integrated super SMA back in 2009. The manager also launched the Aviva Investors Direct SMA product last November. Potter said this exemplifies the mainstream’s take-up of the managed accounts trend. “So there’s a mainstream, reputable, high-quality manager saying: ‘We’ve got to be doing this’.” The distributors that partner with the best managers will gain the most benefit from managed accounts, Potter said. “One of the key consequences of a dealer group moving to a managed accounts approach, instead of having relationships with 25 fund managers, is they narrow their selection down to two or three that get all the money. “You don’t want to be the 131st manager with a managed accounts program. The train would’ve been gone from the station long-since.”