Assets in discretionary model portfolio or managed portfolio services (MPS) grew again over the 6 months to Q1 2023 after difficult market conditions in 2022. Asset growth was again uneven. Quilter Wealth Select, Tatton and Timeline managed to add over £1bn in assets in the year. We understand M&A activity is affecting some DFMs more than others and price pressure continues to be a factor driving flow and increased use of passive instruments. We’re delighted to report on more DFMs than ever before in this update: 40 DFMs supplied us with data. We are also pleased to include more large advice firms that have their own discretionary MPS.

This report, updated bi-annually, forms part of NextWealth’s research and insight on the investment propositions of financial advisers. NextWealth also publishes research on adviser tech and the adviser market, moderates bespoke distribution strategy workshops and hosts a quarterly Council for Fund Distribution. Email enquiries@nextwealth.co.uk for further information.

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Who this report is for

This market report is intended for people in strategy, proposition, distribution and marketing roles in asset management firms, platforms and DFMs. The report quantifies assets in discretionary MPS, compares propositions from leading providers and tracks changes over time. It is for anyone who wishes to understand the UK MPS market more, including for strategic planning, market assessments, board reports and broader general research purposes. The report can be used by:

• DFMs to benchmark their proposition against the competition, including pricing, platform availability, assets and asset growth.
• Asset managers to identify the fastest growing DFMs, to fine tune distribution efforts, to better understand the ambition of their DFM partners.
• Platforms to prioritise DFMs to add to the platform, develop functionality to support DFMs in managing money on behalf of advised clients on platform, and better understand emerging platform DFM propositions.
• Financial advice businesses can use this report to understand the proposition and differentiators of their DFM partners and to benchmark their own outsourced investment proposition.
• Private equity firms and consolidators can use this report to identify takeover targets and to position their pitch to suit the needs of this changing market.

Methodology

The data in this report is collected through NextWealth surveys of financial advisers and employees of financial advice businesses, interviews with senior executives of DFM firms and data provided by 40 DFMs.