I read an excellent blog by NextWealth’s Heather Hopkins recently. In it, she looks ahead to five trends she forecasts are coming.
What really caught my eye is that most of what she’s predicting is something PortfolioMetrix has been doing for nearly a decade. Here are three of her points and my take on them:
Portfolio management will be better integrated into financial planning
Heather makes the point that there is little integration between portfolio management and portfolio planning. This may be true for many but it’s not the case for our partners. PortfolioMetrix was designed to allow full integration through the art of specialism and clearly defined and shared responsibilities.
Our proposition means that:
delivering portfolios for segmented client needs is really straightforward and scalable. This can include both a CIP and a CRP – in that the strategy is the same in the latter but can be combined with an income/growth strategy and not just a growth strategy.
technology can do the heavy lifting. Our WealthExplorer™ technology, which works hand-in-hand with our investment portfolios, removes a lot of the manual work. That, plus integrations with other tools, means the process is streamlined and straightforward.
Hyper-segmentation, not hyper-personalisation
Heather predicts that technology will make hyper-segmentation more scalable.
This plays to the core of our proposition: as I’ve already outlined above, we have the technology that allows our partners to segment clients and offers portfolios that meet their distinct needs, not shoe-horn them into standard MPS, all within a scalable framework.
Our approach allows planners to be central to the investment process, with the ability to tilt the portfolios to:
use a blend of active & passive funds, as preferred
exclude certain asset classes such as property
include ESG preferences
build portfolios in currencies such as EUR & USD, which can also be used with Res Non-Dom clients.
We’ve called this mass-customisation but hyper-segmentation works just as well – and it’s something PROD is pushing planners to adopt.
We will see a rise in the use of alternatives and illiquid assets
Perhaps for some investors but we don’t agree that this will be the norm. As discretionary investment managers, we can access whatever we feel appropriate for portfolios but for CIPs, we believe the demand from the majority of investors will be to avoid getting involved with illiquid assets and direct stocks, mainly due to risk.
Our investment team look at risk in a forensic way. They have a track record of efficient risk frontiers across the range of PortfolioMetrix portfolios. They look at appropriate risk and their many years of experience is put to good use in examining what it could mean to invest in all manner of options.
Thanks for reading so far and apologies if it seems like an ad for PortfolioMetrix. It’s not the first time we’ve come across the forecasts that Heather makes but, in spite of time going by, we still remain unique in what we offer.
As many only children will attest during the recent home-schooling days, it can be lonely being in a class of one. However, we see many advantages of being in a class of our own and it’s a place we are happy to reside for as long as it lasts.