Average DFM portfolio size
Average DFM portfolio size for all three discretionary types continued to increase
This is the ninth Defaqto discretionary fund manager (DFM) satisfaction study based on feedback from adviser firms that have outsourced their client investment assets to third-party discretionary managers.
Accumulation and decumulation
The split between accumulation and decumulation business held steady at roughly 60/40.
Single Asset Funds
Advisory business placed using single asset funds continued to shrink, falling from 11% in 2019 to 4% in 2023.
MPS via an adviser platform
Over two-thirds of advisers access MPS via an adviser platform. Just over half use MPS direct and less than half utilise the bespoke service.
- The study was conducted between August and September 2023 employing online fieldwork techniques; it measured the relative importance of 14 satisfaction categories and identified the advisers’ preferred providers of DFM services.
- The study measured how satisfied the advisers are with their preferred providers and identified where expectations were being met by cross-matching ranked importance with ranked satisfaction.
- Over two-thirds of advisers access MPS via an adviser platform. Just over half use MPS direct and less than half utilise the bespoke service.
- Just short of 20% of respondents said they recommended Tatton Investment Management in the last 12 months. LGT Wealth Management, RBC Brewin Dolphin, Waverton Investment Management and Brooks Macdonald received support from 15% or more adviser respondents.
- In the ranked order of importance, Service is the category ranked most important ahead of Quality of staff – investment, which was ranked first in last year’s study. The average importance scores are largely unchanged as are the ranked positions of importance.
- Ten of the 14 categories achieved scores in excess of 80%, including Service at 88%, two percentage points higher than last time. Many scores were similar to the last study, but with an average two percentage point drop for the worst performing categories.
- Rockhold attained the largest number of top performing categories (12 out of 14), closely followed by Schroder & Co. (10) and Albemarle (9).
- A cross-match of ranked unweighted satisfaction with ranked importance shows that the industry is failing to meet expectations for 9 of the 14 service categories; however, 6 of those 9 show a good correlation between unweighted performance and importance and are only a few percentage points below par.
- Advisory business placed using single asset funds continued to shrink, falling from 11% in 2019 to 4% in 2023.
- Average DFM portfolio size for all three discretionary types continued to increase.
- The split between accumulation and decumulation business held steady at roughly 60/40.
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