Managed Solutions Assets Rise 10% in First Two Quarters to $3.8 Trillion Q3 2014 - Central Summary

Highlights of this edition include:

  • Maintaining momentum that reaches back to the third quarter of 2012, managed solutions assets rose nearly 10% to $3.8 trillion during the first six months of 2014, reflecting parallel gains of 5% in each of the first two quarters. Over the last four quarters, MS assets have increased by 24%.
  • All market segments experienced solid gains in the second quarter. They were led by Rep as Advisor (a non-discretionary, fee-based advisory option), Mutual Fund Advisory – which moved just above the $1 trillion total assets mark during the quarter – and Unified Managed Accounts (UMAs), all with asset growth of over 5%. They were followed closely by Rep as Portfolio Manager, which fell off from an 8% gain in the first quarter to 4.5% in the second, and Separately Managed Account Advisory (SMAs), which ended the second quarter with a 4% asset increase.  
  • Net flows were $80 billion, up about 20% from the $66 billion recorded last quarter. The aggregate trailing four-quarter net flows for the second quarters of 2014 and 2013 were $265 billion and $234 billion, respectively – an increase of about 13%.  
  • Mutual Fund Advisory net flows totaled $29 billion, an increase of more than 70% over flows in the last quarter. Rep as Portfolio Manager finished second with $22 billion in net flows, but its trailing four-quarter trailing net flows of $87 billion continued by a substantial margin to be the highest of any market segment. UMA Advisory ended the quarter with flows of $11 billion –followed by SMAs and Rep as Advisor with net flows of $9 billion and $8 billion, respectively.
  • From the close of 2009 to the end of the second quarter of 2014, the percentage of nondiscretionary accounts in the total account universe dropped 10 full percentage points from 47% to 37%, underscoring a trend toward greater investor reliance on discretionary investment advice.
  • Among major industry segments, the 5% growth in MS assets in the second quarter compares to a 7% increase for Exchange Traded Funds, 5% growth for Long Term Mutual Funds, and a decline of 2% for Money Market Funds.   

Upcoming MMI Data Enhancements Announced

This edition of MMI Central carried an announcement that, over the next few months, MMI will enhance its provision of proprietary industry data, one of its core member benefits. The changes will be twofold: the introduction of an application that will make the data both more accessible and interactive coupled with an expansion of the data sets available to members. This effort is being undertaken in direct response to feedback from a member survey conducted earlier this year.

The online tool will serve as a complement to MMI Central and will enable members to easily access MMI’s proprietary data sets across different timeframes, firm types, product segments, and platform specifics. MMI will also leverage its close partnership with various data and research providers to broaden the scope of the data it makes available to members and provide more granularity into financial advisor use of different types of investment products.