Back in May, IFA Magazine conducted a readership survey in conjunction with Sarasin & Partners, aiming to gauge readers’ views on Managed Portfolio Solutions (MPS). Below, we share the key highlights from the research.
Advisers have been broadly split between using MPS and multi-asset funds to support their clients’ needs for some years. In running this survey in conjunction with Sarasin & Partners, we wanted to find out more about readers’ views and if this is still the case.
Firstly, we’re hugely grateful to every one of you who took the time to share your thoughts with us by responding to the survey. Thanks to you all and, as always, we really appreciate you taking time out of your busy schedules to share your feedback with us.
MPS is a popular choice?
So, what exactly did you tell us? When it comes to the use of MPS, we were interested to see that 67.7% of respondents told us that they currently use MPS options with their clients. Clearly, MPS remains highly relevant and a popular choice by advisers and their teams.
Perhaps, more surprisingly, one aspect of note was that ‘white labelling’ of such solutions really doesn’t seem to be a major factor, with 76.5% of respondents telling us that for them, this just wasn’t important.
Service remains key
However, and this wasn’t exactly a surprise to us, was what really is crucial to advisers is the level of service which a provider delivers to the advice business overall in supporting the investment proposition.
A massively significant 89.9% of respondents reported that it was important to them that the MPS providers they select will need to add value through adviser communication and reporting. In fact, only 5.4% said it wasn’t important with a further 4.7% said they were ‘not sure’.
There’s a big lesson here for providers to ensure that to back up their investment proposition, they will need regular communications and support teams to ensure that the complete package is robust and fit for purpose.
When it comes to using a due diligence partner to help when selecting MPS providers, there was no clear winner amongst our respondents, as shown in Chart 1. Morningstar was the preferred choice for 31.2% of respondents, with FE Transmission also proving popular with 29.7% telling us that they use this service. Other notable results came from langcat analyser (14%) and DD Hub (10.9%) although there was quite a range of other providers including Defaqto, in use by respondents generally.
Chart 1
The popularity of ESG investing seems to have been declining since the heady days of 2021. However, with the drive to net zero such a significant factor in the fight against the climate crisis, we wanted to know how important sustainability/ESG is to readers when they are choosing an MPS. We were quite surprised to see such a big spread of opinions here as shown in Chart 2.
Chart 2
From our survey data, it seems that ESG really is still a factor for advisers when selecting MPS. For 74.2% of respondents choosing a sustainability/ESG MPS is either ‘critically’, ‘very’ or ‘somewhat’ important. For the remainder, it was either ‘not so important’ or ‘not at all important’.
MPS or multi-asset funds?
We’d expected this one to be a close-run thing. But the fact that our respondents were split exactly 50/50 in terms of whether they find that MPS is more popular than multi-asset fund, perfectly demonstrated the differing appeal of these two approaches.
It’s clear that both options remain relevant, suiting a growing range of client scenarios, especially in today’s Consumer Duty era.
Looking ahead, we expect to see both MPS and multi-asset fund options continue their popularity drive both with advisers and their clients, for some time to come, particularly in today’s challenging market conditions.
About the survey
This digital survey (‘MPS Survey 2024’) was carried out online by IFA Magazine on behalf of Sarasin & Partners. It was live from the 1st May – the 9th of May with 192 total responses from the IFA Magazine audience, and 117 completing the survey in full.
